Australian cities more affordable for global expats

by HCA08 Jul 2009

Australian cities remain affordable destinations for overseas expatriates, increasing the appeal of Australia for multinational organisations seeking to manage and contain the costs of a mobile workforce in tighter economic conditions, Mercer's 2009 Worldwide Cost of Living survey has found.

Mercer's 2009 Cost of Living rankings have seen all Australian cities move down in the rankings as a result of worldwide currency fluctuations. 

Rob Knox, head of Mercer's information product solutions business, said notwithstanding recent gains in the Australian dollar, by the end of March 2009 the Australian dollar had weakened by over 25% against the US dollar over the previous 12 months. Consequently, all Australian cities benefited from a cost of living perspective through a significant shift in the ranking this year reflecting dramatic exchange rate fluctuations.

The survey, conducted in March 2009, covers 143 cities across six continents and measures the comparative cost of over 200 items in each location, including housing, transport, food, clothing, household goods and entertainment. It is the world's most comprehensive cost of living survey used to help multinational organisations and governments determine compensation allowances for their expatriate employees.

"The GFC has not put a stop to workforce mobility, but organisations are managing their global workforces with a view to containing costs, which increases the appeal of Australian cities," said Knox. 

"Across the Asia-Pacific region, Australian cities are extremely cost competitive destinations for global workers in comparison to cities such as Beijing, Hong Kong, Tokyo and Osaka, which have all climbed in the rankings this year. 

"This helps makes Australia a very attractive hub for companies looking to grow their presence in the Asia-Pacific region," he said.

Rupert Merrick, manager, Australia,, added that recruiters and employers should not underestimate the pull factors of Australia in 'job-centric migration'. "A move to Australia is often motivated by the future lifestyle it can provide for a worker and their family. If you look at the UK or South African markets people consider Australia and see the sunshine, the space - all the things overseas visitors love about Australia," he said.

In Mercer's survey, New York is used as the base city for the index and scores 100 points, all cities are compared against New York and currency movements are measured against the US dollar.

The survey found the differences in the cost of living between different Australian states is narrowing, with the cost of common expatriate living expenses now competing on a more level playing field between the states - a trend which mirrors recent remuneration and Consumer Price Index (CPI) trends.

Within Australia, Sydney remains the most expensive city for expatriates but has dropped from 15th to 66th place (scoring 75.5 basis points). Melbourne follows in 92nd (69.9 points), down from 36th  place, while Brisbane sits in 116th place (65.3 points), down from 57th, with Perth close behind at 117th place (65.2 points), down from 53rd. Adelaide remains the least expensive city at 130th place (scoring 61.3 points), down from 73rd  place in the rankings.

Globally, Tokyo has knocked Moscow off the top spot to become the world's most expensive city for expatriates. Osaka is in second position, up nine places since last year, whereas Moscow is now in third place. Geneva climbs four places to fourth position and Hong Kong moves up one to reach fifth. Johannesburg has replaced Asunción in Paraguay as the least expensive city in the ranking.


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