Hong Kong Managers Enjoy Highest Purchasing Power

by Mary Swire, Tax-News.com, Hong Kong

16 July 2003

A recent global survey undertaken by human resource consulting group Mercer on salary purchasing power amongst senior managers showed that Hong Kong is the best place to be in terms of pay and living costs, closely followed by Switzerland.

The survey looked at fifty countries, and factored in tax and social security deductions, local cost of living, and average pay for senior managers. The results were based on a purchasing power index which represents the number of times an individual can purchase a basket of goods with their net income. The average net income of US$100,538 for Hong Kong managers gave them a purchasing power index of 6.92, whilst Switzerland had an index of 6.71 from an average $91,092 net income. Somewhat surprisingly, in third place came Ecuador with an index of 6.22 from a relatively small net income of $52,808, probably reflecting a low cost of living.

Within the top ten were Germany in fourth position, and the United States in fifth. Japan and Canada were ranked ninth and tenth respectively. Ireland was positioned in 20th place by the study, as a consequence of having one of the highest costs of living in Europe. The UK featured just outside the top ten in eleventh place.

The survey found that whilst European managers enjoyed some of the best salaries in absolute terms, high social contributions and other taxes forced many EU countries down the table, as evidenced by Belgium and Italy, which figured 23rd and 29th respectively.

Meanwhile, propping up the table in 50th place was Vietnam, with an index of just 1.00. followed by Bulgaria and India with an index of 1.25 and 1.65. The bottom ten nations contained many of the Eastern European countries that are set to become part of the EU next year, including the Czech Republic (47th), Hungary (42nd) and Poland (41st).

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