Geneva: The priciest city for expats
UBS bank has just published its prices and earnings survey for 2018, and the results are unlikely to shock anyone, with Geneva and Zurich ranking amongst the most expensive cities globally, both in terms of prices and earnings. To compile the results, UBS collected and analysed data on the prices of 128 goods and services, and the earnings for 15 professions in 77 cities worldwide. In addition, UBS specifically analysed the cost of expat living in 13 different cities, ranking Geneva as the most expensive city globally for an expat family with children.
The cost of living in this pristinely beautiful expat hub may be eye-wateringly high to those who are unfamiliar with the city. Prices here seem to hit new lofty heights each year, seemingly emulating the dizzying summits of the surrounding mountainous landscape. But will a move to Switzerland really leave your budget as holey as a piece of Swiss cheese? We look at the survey findings and assess what expats who are planning a move to the country should bear in mind when negotiating benefits and considering relocation.
Figure: 1 Flags adorn a bridge over Lake Geneva in the city centre. Credit: hpgreusen, pixabay
To assess the cost of expat living, UBS used local observations, such as the cost of basic expenses, food, household goods and clothing. In addition, it took relevant expat extras into account, such as the price of rent for a two-bedroom apartment, tuition at international schools, household help twice a month and fees for language courses. The average cost of expat living in Geneva for a family with children was found to be 6,000 US dollars. The second most expensive city for expat living was Brussels, although the accommodation was much cheaper here than in Geneva, but extras such as language tuition and international school fees were budget-bustingly expensive. It’s worth bearing in mind that UBS only analysed 13 different cities for this particular set of results, so although the figures are interesting, they do not provide a comprehensive global assessment for prices of expat living worldwide. You can see the full results here.
The cost of living in Switzerland is undoubtedly high, with numerous surveys confirming this each year. The Numbeo cost of living index 2018 listed Zurich and Geneva as the second and third most expensive cities, with Hamilton, Bermuda, coming in first. There’s a myriad of complex reasons to explain Switzerland’s high cost of living, but what does it mean for the Swiss who live there, or the 20 percent of expats who make up the Swiss population?
Alongside the cost of living surveys, UBS also published data which demonstrates the purchasing power of local people and provides valuable insights into how people are affected by the cost of living. To analyse prices of goods in each country, 128 products and services were weighted by their monthly consumption, taking local customs into account. UBS also referenced average earnings across a range of 15 different professions. This data was then used to calculate global purchasing power in the respective cities, using prices in New York City as a relative benchmark.
Expats should be reassured that although the cost of living is extremely high in Switzerland, the purchasing power of consumers remains strong. Zurich took the second spot on the purchasing power list, with Geneva ranking fourth. This was also confirmed by the earnings data also collated by UBS for the survey, which put Geneva and Zurich in first and second positions respectively. Expats relocating to Geneva should therefore not find themselves short of cash. It’s easy to see why Switzerland is such a popular expat destination - not only is Geneva a clean and attractive city, but the surrounding mountains and lakes offer incredible opportunities for outdoor activities. Furthermore, this Swiss gem in consistently ranked high in terms of quality of living, with the 2018 quality of living survey published by Mercer ranking it in the top 10 of global cities, placing it in position eight.
Negotiating a relocation package
Data and surveys such as this published by UBS serve to provide useful insights for would-be expats who are considering a move abroad. Once you have a firm job offer on the table, relevant data on living costs, rent and tuition fees can provide valuable leverage material for negotiating benefits packages. The more research you can do in advance, the more prepared you will be when it comes to planning your budget. Here are some points which you may consider bringing up in discussions with you employer:
- Will you be paid a premium to offset the inconvenience of moving?
- Will you be paid a premium if the city you are moving to ranks poorly for quality of living?
- Will you and your family be provided with a paid trip home on an annual basis?
- Does the relocation package include a house hunting or fact-finding trip prior to the move?
- Are there other benefits included, such as paid language tuition?
A good tip is to thoroughly research comparable salaries in advance, using sites like Glassdoor or Linkedin, or research job adverts for similar positions if possible. If you can, see if you can speak to expats who have already made the move, to assess whether or not your salary and benefits package will cover the costs of the lifestyle to which you and your family are accustomed.