In a recent blog post we looked at the various stages involved in calculating ECA’s cost of living indices. The first stage is to collect 400,000 prices from all over the world every survey. Unsurprisingly, we are often asked how we collect this price data, so in this post we are going to take a closer look at how we source the information that feeds into the cost of living indices and other global mobility data we provide.
We use a range of approaches to collect the price data that is used to calculate indices: ECA’s team of international data researchers, online research, field research companies and assignees working for client companies. This enables us to cross reference for consistency and check for bias. It also enables us to cover a wider range of locations as even if we are not able to visit a city in person we have other reliable and developed sources to fall back on. For example, this resilience built in to ECA’s data collection approach proved particularly useful during the Covid-19 pandemic.
Our team of researchers spend most of their time travelling around the world collecting prices for food and drink, household items, services, transport, accommodation and more. Not only do they bring back prices from the locations they visit but also updates regarding new developments and changes to outlets which may have moved, closed or recently opened. This helps to inform our other data collection approaches and also feeds directly to the analysis.
We are also committed to reflecting trends in assignee shopping preferences and as more purchases are being made through online outlets, collecting this data has become increasingly important. The amount of remote data it is possible to collect online increased as a result of the Covid-19 pandemic. As global travel restrictions came into force, in-person price collection was a less viable option. The global availability of online outlets has rapidly expanded and improved in recent years meaning this has become an increasingly important approach for collecting cost of living data around the world.
Working with networks of data collection organisations enables ECA to extend the breadth and depth of its data. We ensure agents are well-briefed in exactly the items and outlets we wish to price based on the information we receive from expatriates and our own researchers who have experience there. Our experienced team of cost of living analysts vigorously check for any irregularities in the data returned.
When we run our cost of living surveys we ask companies to invite their assignees to get involved. By inviting them to record the prices of items in the outlets they regularly go to, we not only get a true picture of where and how they shop but also give them an opportunity to have some involvement in how their cost of living allowances are calculated. The questionnaires received from assignees are subjected to a thorough verification process. Prices are checked against each other and against previous years to ensure validity and to pick up any anomalies or collusion between assignees.
What this means for you
ECA’s multi-source approach guarantees integrity. The user can be sure of valid and representative data. Price data from all our sources are collated and analysed using techniques that have been developed over the 50 years that we have been surveying living costs to publish consistent and defensible cost of living indices.
However, providing an index is just part of the story. Without knowing how and when to apply them, what to include or exclude in an index, how to calculate the spendable income to apply them to and how to update them, they are just a figure. Luckily, we have the calculators, software and knowledge to help you with that!
FIND OUT MORE
Please contact us to speak to a member of our team directly.
ECA publishes cost of living data for more than 500 locations around the world. Learn more about ECA’s cost of living data by downloading our FREE cost of living white paper which explains how ECA's indices are calculated and applied to protect the buying power of people moving between countries as well as looking at what causes them to change over time.
It is available from ECA as part of a subscription or as one-off calculations. It is also built in to ECA’s Build-up, Net-to-Net and Cost-estimate calculators which enable calculations in seconds. Cost of living data is also pre-populated in ECAEnterprise, our Assignment Management System.