Ease of Business Operations, Quality of Life Matter When Relocating Employees

Study helps HR consider what life may be like for expats

By Aaron Hightower Mar 28, 2017

​When expanding business operations around the globe, HR professionals should consider cities that make it easier for their businesses to function and for expats to adapt, according to Mercer's 19th annual Quality of Living Survey.

Despite growing financial and political instability in Europe, many cities there offer the world's best quality of living and remain appealing destinations for enlarging company ventures and relocating employees, according to the survey.

"In uncertain times, organizations that plan to establish themselves and send staff to a new location should ensure they get a complete picture of the city, including its viability as a business location and its attractiveness to key talent," stated Ilya Bonic, senior partner and president of Mercer's Career business division, in a release.

Europe claims eight of the top 10 cities on Mercer's list with Vienna taking the top spot for the eighth straight year.

The survey examined 450 cities worldwide and based its findings on 39 factors grouped in 10 quality-of-life categories: economic, social, political and socio-cultural environments; medical and health; education; public services; recreation; housing; and the availability of consumer goods. Infrastructure, which considered accessibility of transportation, electricity, mail services, telephone and drinking water, was a factor, too.

The New York-based HR consultancy produces its annual survey to provide companies a snapshot of what new locations may be like—and to reveal how different life may be for employees living and working abroad.

"Historically, Mercer has been in the forefront of helping organizations determine appropriate compensation packages for sending employees to overseas locations. And when you're making that kind of deployment on the organizational side, it's important to have information about the quality of living that [employees are] going to experience in their new assignment location and how it's going to change relative to where they are coming from," said Vince Cordova, a principal at Mercer and the company's mobility leader  for the East Region, in an interview with SHRM Online.

[SHRM members-only HR Q&A on International Assignment Taxes: How do we handle income taxes for expatriates?]

"There is a definite need in the marketplace for this, because companies want this from a planning perspective to see where they want to move an employee. But, also, when they have to move an employee and [his or her] family to a location, it may present some challenges," Cordova said. "You've got to help them develop appropriate compensation benchmarks to help address any deterioration in the quality of living."

According to the survey, Western Europe boasts some of the highest quality of living in the world.

Those in the top 10 are:

  1. Vienna, Austria.
  2. Zurich, Switzerland.
  3. Auckland, New Zealand.
  4. Munich, Germany.
  5. Vancouver, British Columbia, Canada.
  6. Dusseldorf, Germany.
  7. Frankfurt, Germany.
  8. Geneva, Switzerland.
  9. Copenhagen, Denmark.
  10. Basel, Switzerland.

Vienna, Cordova said, continues to top the list every year because it is the cultural, political and economic center of Austria.

"[Vienna] has a stable environment for expatriates, it has an extensive offering of consumer goods, a high level of utilities, the transportation is excellent, the facilities are excellent, and it has great cultural and recreational opportunities," Cordova said.

In North America, Canada has three cities in the top 20: Vancouver (No. 5), Toronto (16) and Ottawa (18). San Francisco ranked 29th as the first U.S. city on the list; followed by Boston (35) and Honolulu (36). While Atlanta ranked 65th in overall quality of life, it topped all U.S. cities in terms of the best infrastructure.

"San Francisco comes out on top because it ranks higher across U.S. cities in all those factors," Cordova said. "I think it's an important thing to note that the top 60 to 70 cities are all highly livable cities and the differences in the overall scores between those cities isn't that significant."  

Perhaps what is significant are the African and Mideast regions, which have cities with some of the worst quality of living, according to the survey. Baghdad, due to its political and social unrest in the past few decades, ranked dead last.

The bottom 10 cities are:

  1. Conakry, Guinea.
  2. Kinshasa, Congo.
  3. Brazzaville, Congo.
  4. Damascus, Syria.
  5. N'Djamena, Chad.
  6. Khartoum, Sudan.
  7. Port-au-Prince, Haiti.
  8. Sana'a Republic of Yemen.
  9. Bangui, Central African Republic.
  10. Baghdad, Republic of Iraq.

"If you think about how uncertain the world is right now and if you are looking to establish yourself in a market or move your top performers to a given market, it's really helpful to have a complete picture of what that city is going to look like for that individual," Cordova said. "And that's what these reports do," he said of the company's survey. "They give you a sense of how attractive that location would be to key talent."

Aaron Hightower is a freelance writer in Detroit.

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