Vienna is the city with the world's best quality of living, according to
the Mercer 2014 Quality of Living rankings in which European cities
dominate. Zurich and Auckland follow in second and third place,
respectively. Munich is in fourth place, followed by Vancouver, which is
also the highest-ranking city in North America. Ranking 25 globally,
Singapore is the highest-ranking Asian city, whereas Dubai (73) ranks
first across Middle East and Africa. The city of Pointe-à-Pitre (69),
Guadeloupe, takes the top spot for Central and South America.
Mercer conducts its Quality of Living survey annually to help
multinational companies and other employers compensate employees fairly
when placing them on international assignments. Two common incentives
include a quality-of-living allowance and a mobility premium. A
quality-of-living or "hardship" allowance compensates for a decrease in
the quality of living between home and host locations, whereas a
mobility premium simply compensates for the inconvenience of being
uprooted and having to work in another country. Mercer's Quality of
Living reports provide valuable information and hardship premium
recommendations for over 460 cities throughout the world. The ranking
covers 223 of these cities.
"Political instability, high crime levels, and elevated air pollution
are a few factors that can be detrimental to the daily lives of
expatriate employees, their families, and local residents. To ensure
that compensation packages reflect the local environment appropriately,
employers need a clear picture of the quality of living in the cities
where they operate," said Slagin Parakatil, Senior Researcher at Mercer.
Mr. Parakatil added, "In a world economy that is becoming more
globalized, cities beyond the traditional financial and business centers
are working to improve their quality of living so they can attract more
foreign companies. This year's survey recognizes so-called 'second tier'
or 'emerging' cites and points to a few examples from around the world.
These cities have been investing massively in their infrastructure and
attracting foreign direct investments by providing incentives such as
tax, housing, or entry facilities. Emerging cities will become major
players that traditional financial centers and capital cities will have
to compete with."
Vienna is the highest-ranking city globally. In Europe, it is followed
by Zurich (2), Munich (4), Düsseldorf (6), and Frankfurt (7). "European
cities enjoy a high overall quality of living compared to those in other
regions. Healthcare, infrastructure, and recreational facilities are
generally of a very high standard. Political stability and relatively
low crime levels enable expatriates to feel safe and secure in most
locations. The region has seen few changes in living standards over the
last year," said Mr. Parakatil.
Ranking 191 overall, Tbilisi, Georgia is the lowest-ranking city in
Europe. It continues to improve in its quality of living, mainly due to
a growing availability of consumer goods, improving internal stability,
and developing infrastructure. Other cities on the lower end of Europe's
ranking include: Minsk (189), Belarus; Yerevan (180), Armenia; Tirana
(179), Albania; and St. Petersburg (168), Russia. Ranking 107, Wroclaw,
Poland is an emerging European city. Since Poland's accession to the
European Union, Wroclaw has witnessed tangible economic growth, partly
due to its talent pool, improved infrastructure, and foreign and
internal direct investments. The EU named Wroclaw as a European Capital
of Culture for2016.
Canadian cities dominate North America's top-five list. Ranking fifth
globally, Vancouver tops the regional list followed by Ottawa (14),
Toronto (15), Montreal (23), and San Francisco (27). The region's
lowest-ranking city is Mexico City (122), preceded by four US cities:
Detroit (70), St. Louis (67), Houston (66), and Miami (65). Ed Hannibal,
Partner and Global Consulting Leader for Mercer's Mobility practice
commented, "On the whole, North American cities offer a high quality of
living and are attractive working destinations for companies and their
expatriates. A wide range of consumer goods are available, and
infrastructures, including recreational provisions, are excellent."
In Central and South America, the quality of living varies
substantially. Pointe-à-Pitre (69), Guadeloupe is the region's
highest-ranked city followed by San Juan (72), Montevideo (77), Buenos
Aires (81), and Santiago (93). Manaus (125), Brazil has been identified
as an example of an emerging city in this region due to its major
industrial center which has seen the creation of the "Free Economic Zone
of Manaus," an area with administrative autonomy giving Manaus a
competitive advantage over other cities in the region. This zone has
attracted talent from other cities and regions with several
multinational companies already settled in the area and more expected to
arrive in the near future.
"Several cities in Central and South America are still attractive to
expatriates due to their relatively stable political environments,
improving infrastructure, and pleasant climate," said Mr. Hannibal. "But
many locations remain challenging due to natural disasters, such as
hurricanes often hitting the region as well as local economic inequality
and high crime rates. Companies placing their workers on expatriate
assignments in these locations must ensure that hardship allowances
reflect the lower levels of quality of living."
Singapore (25) has the highest quality of living in Asia followed by
four Japanese cities: Tokyo (43), Kobe (47), Yokohama (49), and Osaka
(57). Dushanbe (209), Tajikistan is the lowest-ranking city in the
region. Mr. Parakatil commented, "Asia has a bigger range of
quality-of-living standard among its cities than any other region. For
many cities, such as those in South Korea, the quality of living is
continually improving. But for others, such as some in China, issues
like pervasive poor air pollution are eroding their quality of living."
With their considerable growth in the last decade, many second-tier
Asian cities are starting to emerge as important places of business for
multinational companies. Examples include Cheonan (98), South Korea
which is strategically located in an area where several technology
companies have operations. Over the past decades, Pune (139), India has
developed into an education hub and home to IT, other high-tech
industries, and automobile manufacturing. The city of Xian (141), China
has also witnessed some major developments, such as the establishment of
an "Economic and Technological Development Zone" to attract foreign
investments. The city is also host to various financial services,
consulting, and computer services.
Elsewhere, New Zealand and Australian cities rank high on the list for
quality of living, with Auckland and Sydney ranking 3 and 10,
Middle East and Africa
With a global ranking of 73, Dubai is the highest-ranked city in the
Middle East and Africa region. It is followed by Abu Dhabi (78), UAE;
Port Louis (82), Mauritius; and Durban (85) and Cape Town (90), South
Africa. Durban has been identified as an example of an emerging city in
this region, due to the growth of its manufacturing industries and the
increasing importance of the shipping port. Generally, this region
dominates the lower end of the quality of living ranking, with five out
of the bottom six cities. Baghdad (223) has the lowest overall ranking.
"The Middle East and especially Africa remain one of the most
challenging regions for multinational organizations and expatriates.
Regional instability and disruptive political events, including civil
unrest, lack of infrastructure, and natural disasters such as flooding,
keep the quality of living from improving in many of its cities.
However, some cities that might not have been very attractive to foreign
companies are making efforts to attract them," said Mr. Parakatil.
Mercer is a global leader in talent, health, retirement, and
investments. Mercer helps clients around the world advance the health,
wealth, and performance of their most vital asset - their people.
Mercer's more than 20,000 employees are based in 43 countries, and the
firm operates in over 140 countries. Mercer is a wholly owned subsidiary
& McLennan Companies (NYSE:MMC), a global team of professional
services companies offering clients advice and solutions in the areas of
risk, strategy, and human capital. With over 54,000 employees worldwide
and annual revenue exceeding $11 billion, Marsh & McLennan Companies is
also the parent company of Marsh,
a global leader in insurance broking and risk management; Guy
Carpenter, a global leader in providing risk and reinsurance
intermediary services; and Oliver
Wyman, a global leader in management consulting. For more
information, visit www.mercer.com.
Follow Mercer on Twitter @MercerInsights.
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