- Driven by lower cost of benefits and a dip in salaries, the overall cost of employing a mid-level expatriate worker in Singapore has dropped by USD 7,284. Nevertheless, cash salaries of expatriates in Singapore remain 5th highest worldwide.
- As Singapore looks to ease business travel, the latest rankings are expected to increase the country’s attractiveness to expatriates and companies looking to set up regional hubs in the country, which also holds the title of the location offering the best quality of living globally.
Singapore is now the 17th most expensive location globally for companies to send expatriates to, with the average pay package for a mid-level worker costing companies USD 225,171 annually. Globally, Japan overtakes the United Kingdom as the most expensive location to send workers to, with the average expatriate package there costing USD 405,685. These were some of the findings of the latest MyExpatriate Market Pay survey published by ECA International, the world's leading provider of knowledge, information, and software for the management and assignment of employees around the world.
When considering the cost of an expatriate package, companies need to factor in three main elements: the cash salary, benefits – such as accommodation, international schools, utilities, or cars – and tax. To assist companies looking to relocate their staff with benchmarking their packages against the market, ECA conducts its annual MyExpatriate Market Pay Survey of pay levels for expatriates around the world, covering all the aforementioned considerations.
Lee Quane, Regional Director – Asia at ECA International said: “As we’ve seen in many locations across the world, expatriate pay packages in Singapore have taken a hit. This drop in pay packages is partly driven by lower costs of accommodation and other benefits commonly provided to white collar expatriates, but employees themselves are also taking home approximately USD 1,000 less in cash salary than their peers in 2019.”
“Nevertheless, cash salaries paid out to expatriates in Singapore remain the 5th highest worldwide. This means that expatriates in Singapore are more likely to be paid more compared to their peers in other locations. Combined with its ranking as the location with the best quality of living in the world, these trends serve to increase Singapore’s attractiveness to expatriates looking to move to the region and to companies looking to establish a regional hub in the country, given the cheaper cost of employing expatriate staff,” he added.
Asia Highlights
- Expatriate packages see overall decreases in Hong Kong and Malaysia, in light of falling accommodation costs.
- Thailand sees biggest plunge in rankings, dropping out of the global top 20 most expensive locations to hire expatriate employees.
- Taiwan bucks the trend, moving into the top ten most expensive locations globally, as rising housing prices inflate benefit packages.
Expatriate pay packages in Hong Kong dropped by over USD 5,000 over the last year, to a new average total of USD 279,399. This was in spite of a slight average salary increase of USD 265.
Quane said “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. While salaries for expatriates in Hong Kong rose by less than 1%, employers were able to benefit from lower accommodation costs, and reduce the amount of financial support provided for housing compared to previous year.”
Elsewhere, Malaysia also saw a similar trend to many other nations in the world, with the cost of the average expatriate pay package falling by USD 2,813 in 2020 compared to the year before.
“The average mid-level expatriate in Malaysia saw a salary of USD 71,025 in 2020, which is slightly less than the previous year. The cost of benefits fell by a much more significant USD 1,952 on average, as rents dropped amid a lack of demand for expatriate accommodation, which had been brought on by the Covid-19 pandemic and restrictions on international travel”, said Quane.
Meanwhile, one of the largest drops in expatriate pay packages was seen in Thailand, where the average value of a pay and benefits package for overseas employees fell by just under USD 18,000.
“Thailand has dropped eight places in our rankings, and is now outside the top 20 most expensive locations to employ expatriate staff. We saw a big drop in the value of expatriate packages in Thailand in 2020, with salaries dropping by USD 3,462 on average and benefit costs falling by over USD 8,500, making it significantly cheaper for a company to employ a mid-level expatriate employee in the current market”, explained Quane.
On the other hand, Taiwan bucked the trend seen in many locations across Asia, entering the global top ten most expensive locations to employ expatriates for the first time as the overall cost of expatriate packages rose in the market.
“The cost of employing a mid-level expatriate in Taiwan increased by USD 10,733 last year as all aspects of expatriate pay packages rose. The most significant rise was seen in benefits costs, which surged by USD 6,500 on average off the back of a steep rise in rents in the local housing market – a result of Taiwan’s initial success in mitigating the transmission of the Covid-19 virus. Furthermore, cash salaries rose by just over 1%, which, despite not being a high rate of increase, was still higher than comparable locations in the region. Consequently, Taiwan has leapfrogged nations such as South Korea and Australia in our rankings, and is now the tenth most expensive location to employ expatriate staff”, noted Quane.
-ENDS-
Notes to Editors
The list of countries used in the rankings is based on countries which have cities appearing in the top 40 of The Global Financial Centres Index (GFCI). The GFCI has been produced since 2007 by commercial think-tank the Z/Yen Group in order to examine the major financial centres globally in terms of competitiveness. It draws on data from the United Nations, World Bank and EIU as well as over 29,000 financial centre assessments from an online questionnaire.
About ECA International
ECA International is the market-leading provider of knowledge, information and technology that enables businesses to manage their international reward programmes.
Partnering with thousands of clients on every continent, we provide a fully integrated suite of quality data, specialist software, consultancy and training. Our unparalleled insights guide clients as they mobilise their most valuable resource: people.
We make the complex world of international mobility simple, providing clients with the expertise and support they need to make the right decisions – every time.
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About ECA's MyExpatriate Market Pay Survey
ECA's MyExpatriate Market Pay Survey looks at pay levels for expatriates around the world, including information on benefits, allowances, salary calculation methods and tax treatment.
The results, free to participants, enable companies to benchmark their expatriates' actual salaries against the market. More than 300 companies took part in the survey covering 160 countries and over 10 000 international assignees.
Figures used in this release were collected in the later stages of 2020 and refer to a Middle Manager position based on 80 ECA Points. ECA Points is a job evaluation system that measures the influence, scope and responsibilities of a job.
There are a number of ways in which salary packages for expatriates may be calculated. The information provided by participant companies in our survey relates to home and host-based salary systems as well as locally-hired and localised expatriates and expatriates on indefinite contracts.
Certain types of allowances are specifically excluded from the analysis in the reports. These are one-off payments such as allowances for outfit, furniture, disturbance and relocation.
Benefits values are based on standard ECA assumptions and have been derived from data in ECA's accommodation and benefits reports to provide an estimate of the cost of providing these benefits. The actual costs or allowances paid to cover these benefits vary widely according to each company's policy.
Tax figures used here refer to employee taxes and do not take company contributions into account. For ease of comparison, it is assumed that cash allowances are paid to employees to cover the cost of any benefits provided.
The accommodation figure is representative of the cost of housing two adults and one child. Utilities covers heat, light, water and telephone charges. Education assumes one child attending a local international school. The car figure covers annual running costs and is based on a standard cars value (2000 cc), depreciated over five years.
For further information, please contact:
Jack Firth
+44 (0)20 7351 5000
jack.firth@eca-international.com