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Decline in disposable incomes causing expat concern
| Published: | 19 Oct at 6 PM |
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Relocation is often seen as the answer to stagnant wages and stalled career opportunities, but expat professionals nowadays are often struggling to make ends meet.
For several decades, accepting relocation overseas was synonymous with a vast increase in salary, a luxury lifestyle and a boost in career prospects. Nowadays, worldwide economic instability and fewer opportunities in desirable locations are causing concerns about diminishing salaries, fewer benefits and the rising costs of living in the majority of expat hubs.
Expat relocation packages traditionally include international schooling, healthcare costs and accommodation in addition to high salaries, with some offering other fringe benefits as well. However, companies worldwide are now tightening their corporate belts and expecting their expat professionals to do the same. Popular expat countries including the Gulf States, Singapore and Hong Kong are now some of the world’s most expensive places to live and work, making maintaining a comfortable lifestyle ever more difficult.
Reports suggest Singapore-based expats are having a tough time, with some 1.3 million foreigners struggling financially. Expat packages providing a salary, benefits and tax have dropped to around $316,000 a year, a fall of six per cent, with Hong Kong packages shrinking by two per cent to $356 per annum. Obviously, it’s better to take an executive position in the latter but, again, economic stability in the former British colony is fragile due to China’s political position.
Worldwide economic decline has resulted in some employers finding relocating staff a more affordable option than in the past. The actual cost of packages has fallen by 11 per cent, allowing employers to offer more benefits to potential expat employees, especially if they’re relocating to the UK. The sting in the tail for expats, however, is Britain’s high levels of income tax and its effect on expats’ disposable incomes.
Obviously, expat salaries vary according to sector and location with, for example, workers in the development and humanitarian aid sector receiving 900 per cent more in salary than local workers. Expats with similar qualifications to local staff also get far more in benefits, including paid leave and health insurance. Wage gaps may be a controversial issue, but it’s a fact that most relocating foreigners do very well financially compared to local employees in similar jobs.
For several decades, accepting relocation overseas was synonymous with a vast increase in salary, a luxury lifestyle and a boost in career prospects. Nowadays, worldwide economic instability and fewer opportunities in desirable locations are causing concerns about diminishing salaries, fewer benefits and the rising costs of living in the majority of expat hubs.
Expat relocation packages traditionally include international schooling, healthcare costs and accommodation in addition to high salaries, with some offering other fringe benefits as well. However, companies worldwide are now tightening their corporate belts and expecting their expat professionals to do the same. Popular expat countries including the Gulf States, Singapore and Hong Kong are now some of the world’s most expensive places to live and work, making maintaining a comfortable lifestyle ever more difficult.
Reports suggest Singapore-based expats are having a tough time, with some 1.3 million foreigners struggling financially. Expat packages providing a salary, benefits and tax have dropped to around $316,000 a year, a fall of six per cent, with Hong Kong packages shrinking by two per cent to $356 per annum. Obviously, it’s better to take an executive position in the latter but, again, economic stability in the former British colony is fragile due to China’s political position.
Worldwide economic decline has resulted in some employers finding relocating staff a more affordable option than in the past. The actual cost of packages has fallen by 11 per cent, allowing employers to offer more benefits to potential expat employees, especially if they’re relocating to the UK. The sting in the tail for expats, however, is Britain’s high levels of income tax and its effect on expats’ disposable incomes.
Obviously, expat salaries vary according to sector and location with, for example, workers in the development and humanitarian aid sector receiving 900 per cent more in salary than local workers. Expats with similar qualifications to local staff also get far more in benefits, including paid leave and health insurance. Wage gaps may be a controversial issue, but it’s a fact that most relocating foreigners do very well financially compared to local employees in similar jobs.
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