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Hong Kong is 4th most expensive place to keep expats
Hong Kong is the fourth most expensive place in the world to employ expatriates, but the cost of employing a mid-level worker fell by US$5,067 (HK$39,400) from a year ago, a survey has found.
ECA International found that the overall cost of an average pay package for an expatriate in Hong Kong in 2020 was US$279,399.
The survey also revealed that Japan overtook the UK as the world's most expensive location, with the average expat pay package costing US$405,685.
ECA said when considering the cost of employing an expatriate, companies need to factor in three main elements: cash salary, benefits such as accommodation, international schools, utilities or cars, and tax.
“The cost of employing an expatriate in Hong Kong was lower in 2020 than in previous years, but this was indicative of a much larger global trend we saw in many countries across the world in 2020” said Lee Quane, Regional Director – Asia at ECA.
He added that the ongoing effects of Covid-19 were felt by many major economies in 2020, and this meant that the cost of overall expat pay packages dropped in over half of the nations included in the rankings.
Quane also said cash salaries for expatriates in Hong Kong rose by less than one percent, while employers were also able to benefit from lower accommodation costs in Hong Kong and reduce the value of financial support for housing in comparison to that provided to these expatriates’ predecessors.
There were similar decreases in pay packages for expatriates in Singapore, where the average package fell by US$7,284 (about HK$56,700) , with salaries falling by an average of US$1,169 (about HK$9,100), ECA said.
The survey also pointed out that expatriate pay packages fell notably on the mainland - by a total of US$17,762 (about HK$138,000) on average - with cash salaries falling by nearly US$3,000 (about HK$23,400) from 2019.
“The big drop in benefits costs is primarily due to expatriate-level rents falling in many tier 1 Chinese cities such as Beijing, Shanghai and Shenzhen, and has thus resulted in the Mainland China falling behind India in the global rankings,” Quane explained.
However, Taiwan bucked the trend seen in many locations in Asia, as the overall cost of pay packages rose and entered the global top ten most expensive locations to employ expatriates for the first time.
The survey also revealed that Japan overtook the UK as the world's most expensive location, with the average expat pay package costing US$405,685.
ECA said when considering the cost of employing an expatriate, companies need to factor in three main elements: cash salary, benefits such as accommodation, international schools, utilities or cars, and tax.
“The cost of employing an expatriate in Hong Kong was lower in 2020 than in previous years, but this was indicative of a much larger global trend we saw in many countries across the world in 2020” said Lee Quane, Regional Director – Asia at ECA.
He added that the ongoing effects of Covid-19 were felt by many major economies in 2020, and this meant that the cost of overall expat pay packages dropped in over half of the nations included in the rankings.
Quane also said cash salaries for expatriates in Hong Kong rose by less than one percent, while employers were also able to benefit from lower accommodation costs in Hong Kong and reduce the value of financial support for housing in comparison to that provided to these expatriates’ predecessors.
There were similar decreases in pay packages for expatriates in Singapore, where the average package fell by US$7,284 (about HK$56,700) , with salaries falling by an average of US$1,169 (about HK$9,100), ECA said.
The survey also pointed out that expatriate pay packages fell notably on the mainland - by a total of US$17,762 (about HK$138,000) on average - with cash salaries falling by nearly US$3,000 (about HK$23,400) from 2019.
“The big drop in benefits costs is primarily due to expatriate-level rents falling in many tier 1 Chinese cities such as Beijing, Shanghai and Shenzhen, and has thus resulted in the Mainland China falling behind India in the global rankings,” Quane explained.
However, Taiwan bucked the trend seen in many locations in Asia, as the overall cost of pay packages rose and entered the global top ten most expensive locations to employ expatriates for the first time.
