In which city in the world would you have the biggest purchasing power?
New York is today the most expensive city in the world.However, you would have better purchasing power than in Paris or in Lyon.Surprising?Not when we remember that purchasing power depends on two variables: the price level but also that of wages.UBS published Thursday, September 17, the 2015 edition of her "Prize and wages" study, which she realizes every three years.The teams of the Swiss bank have carried out titanic work as such.From 68.000 data, they compared the relative purchasing power of a family with a "European" life standard in 71 of the largest agglomerations on the planet.The results are striking.
At first, UBS therefore attacked the price level by determining a common basket of 122 goods and services.Foodstuffs, clothing, transport, household appliances, consumer electronics, restaurant, price for a haircut ... 70% of the Harmonized Consumer Price Index is covered.This basket, supposed to reflect the monthly consumption of a European household of three people, was then weighted according to lifestyle.Bank analysts considered, for example, that this typical European family consumes nearly 15 kilos of vegetables per month but that it only bought a new computer every 2 and a half years.In addition, UBS has taken into account the rents practiced in each city, in order to reflect the cost of living as faithfully as possible as possible.Finally, all prices have been adjusted according to exchange rates.For the needs of the survey, products that are difficult to available in certain regions of the globe have been replaced by local substitutes.
Thanks to this data, the reader will be able to realize that the city of New York has become the most expensive in the world.Note that in this study, Zurich acts as a reference basis and represents an index 100.The relative cost of goods and services, including rents, thus reaches a 107.9 index in the large apple.At comparable income, New Yorkers must therefore devote 8% more of their wages to housing than the inhabitants of Zurich, those of Hong Kong 16%.
Sofia, ville la moins chère du globe
After New York, the least affordable cities on the planet are Zurich, Geneva and Oslo.The Swiss cities are notably "victims" of the important assessment of the Swiss franc, whose value jumped compared to the euro and the dollar.Conversely, the cities of the euro zone, with the monetary policy of the ECB drive by Mario Draghi, have become cheaper.The French capital is thus only in 18th position of this list.But it is in Sofia, kyiv and Bucharest, by far, that life is the most affordable.
UBS did not stop there since the study of the Swiss bank then compared the level of wages, always with the city of Zurich as reference (index 100).An average active population profile was created from 15 different professions.This goes from the building worker (25 and single) to the electricity engineer (40 years with two children), passing by the seller of a department store, the product manager, the cook, the teacher, the nurse or the credit broker.The weight of each of these professions has been adapted in order to better represent the European active population.Net salary is obtained after payment of social and employer contributions, as well as after taxes and special deductions depending on cities.
From this point of view, it is the Swiss workers who are the best off, with Zurich and Geneva who arrive at the top.An employee of Zurich thus has 23 times more money than his counterpart in kyiv and earns twice better his life than in Paris.We notice in passing that Parisians are better paid than the inhabitants of Berlin, Rome or Madrid.
9 minutes de travail pour un Big Mac
It only remains to combine wage level and price level to obtain purchasing power.Again, the Helvetians come first, despite the high cost of life.The main American cities (Los Angeles, Chicago, New York) are also in the leading peloton, followed by several German agglomerations.In France, the purchasing power in Lyon is notoriously higher than in Paris.Among the biggest surprises, Nicosia (in Cyprus) arrives in 7th position in terms of purchasing power.Conversely, Chinese cities find themselves at the bottom of the ranking.
The UBS survey also compares the working time necessary for an employee of each of the 71 cities to offer certain goods.In kyiv, an employee must work 30 times longer than to Zurich to afford the latest iPhone, or 627.2 hours.A Parisian employee will take 42.2 hours, against less than 24 hours for a New Yorker.Likewise, the price of a Big Mac represents 9 minutes of work in Hong Kong, against 87 minutes in Manila (see the full study below).
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Find the full study of UBS below:
