HK falls in rankings of locations with highest expatriate packages
Expatriate pay and benefits packages in Hong Kong rose by a modest US$3,800 (HK$29,640) in 2021, to a total of US$283,000 (HK$2.2m), a rate of growth that was amongst the lowest of all locations in Asia.
This was one of the findings of the latest Expatriate Market Pay Survey published annually by research firm ECA International.
When considering the cost of an expatriate package, companies need to factor in three main elements: the cash salary, benefits – such as accommodation, international schools or cars – and tax.
Salary and benefits packages rose by 1% in Hong Kong in 2021. Hong Kong falls three places to eighth position in the rankings. While UK reclaims its status as the location with the highest expatriate packages where the average expatriate salary and benefits package is over US$440,000 (HK$3.43m).
“Cash compensation packages (for expatriate staff in Hong Kong) rose by a rate of 4.5% in USD terms, but this was lower than rates of growth seen in other regional economies such as Japan and Singapore,” said Lee Quane, Regional Director – Asia at ECA International.
He added that the costs of benefits continued to fall, as it did in 2020, with falls particularly in the cost of accommodation moderating the impact of the increase in cash compensation on overall employment costs.
China remains the location with the third-highest expatriate packages in the region after Japan and India. “While its position in the rankings remains unchanged, cash salaries paid to expatriate staff increased by over 11% in 2021 in USD terms relative to the year before,” said Quane.
Elsewhere, expatriates in most other locations in the region saw their salaries rise at an average rate of 9%, while overall packages rose by 10%, in 2021.
Cash salaries in USD terms rose by 9.5% in Singapore in 2021 and the overall value of a salary and benefits package rose by just over 10% to just under US$250,000 (HK$1.95m) per annum.
In spite of relatively high rates of salary and overall package growth in the region, many countries also joined Hong Kong and Singapore in falling in the rankings. They included Taiwan, Thailand and Vietnam.
Quane explained, “While all locations in the region saw an increase in pay packages for expatriate staff, many nonetheless fell in our rankings as the rates of growth were lower than those experienced elsewhere.”
Australia and New Zealand rose significantly in the rankings, by eight and 16 places respectively owing to a combination of the strengthening of their currencies, increased benefits costs and income tax changes in the past 12 months.
Malaysia remains the location in the region with the lowest expatriate compensation and benefits packages even though cash salaries rose by 11% in 2021.