The UK is now one of the cheapest countries in Europe for overseas employers, according to the global Cost of Living Index from ECA International (ECA).
The Index compares a selection of like-for-like consumer goods and services commonly purchased by international assignees in 470 locations worldwide. The UK was found to be one of the cheapest countries in Western Europe behind Italy, Germany and France.
UK locations featured in the Cost of Living Index include central London, outer London, Edinburgh, Manchester, Cardiff, Glasgow and Belfast, all of which have fallen in ranking in the past year, whereas many cities throughout Europe have risen. London had fallen to the 139th most expensive city in the world, dropping 36 places in 12 months, putting it behind Athens (137th), Rio (120th), Dublin (82nd) and the Zimbabwean capital Harare (133rd).
Steven Kilfedder, production manager at ECA International, warned that there are both positive and negative outcomes of being a cheap country to work in. “Although doing business in the UK is now cheaper for overseas companies, the current situation will make it harder for UK companies to expand, invest and move people abroad,” he said.
A strong year for the euro has caused many European cities to rise in cost, according to the researchers. All Scandinavian capital cities remained in the top 10 most expensive cities in Europe, and all Eurozone cities surveyed saw an increase in the rankings. The most notable were Eindhoven (up 32 places), Hamburg (up 23 places), and Luxembourg City (up 22 places).
“Many cities in Europe have leapfrogged others in the rankings, with the euro now one of the world’s strongest currencies, while currencies have weakened elsewhere,” said Kilfedder.
The news coincides with a report from the ONS that suggests EU migration to the UK was down 43% in the year since the Brexit referendum. Office development, a key indicator of business growth, was down 9%.
However, the number of professionals seeking new opportunities has been inching up since April, with November only seeing a slight decrease.
“The City is on the receiving end of a lot of punches these days, but it keeps getting back up to fight another day,” said Hakan Enver, operations director of Morgan McKinley Financial Services. “Despite the ongoing questions raised around the future of the City, organisations are still going out of their way to make sure that they are offering high premiums and a competitive salary to attract talented individuals.”
