London remains the most expensive city to accommodate an employee
The Live/Work Index, compiled by estate agent Savills, looks at the combined costs of both residential and office rental space. The survey placed the UK capital at the top of the list ahead of New York, and at more than double the cost of cities such as Sydney, Los Angeles and Chicago.
According to the report, it costs $112,800 (c. £80,763) for a business to accommodate a single person in London for a year. This compares to an average of $56,855 (c. £40,656) across the 20 cities measured, making London twice as expensive as the average.
New York was in second place with accommodation costs of $111,300 (c. £79,589) and Hong Kong was third at $103,200 (c. £73,797). After that there’s a sharp drop to Paris in fourth with accommodation costs of $78,200 (c. £55,919) and Tokyo in fifth with $69,800 (c. £49,913).
The rest of the top 10 cities were San Francisco, Lagos, Singapore, Dubai and Sydney, where the average costs ranged between $66,800 (c. £47,767) and $49,500 (c. £35, 397).
Not every business in the UK capital will end up paying so much of course, for their residential accommodation or office rental. Different businesses have different requirements when it comes to both premises and staff. Some may employ a staff pool who largely commute for example but, for businesses requiring top talent who are skilled and flexible enough to choose where they live and work, building the cost of living into any remuneration package could be essential.
At the same time, outgoings including salaries, relocation costs and office rental need to be carefully balanced against income, otherwise a business could easily find itself in difficulty. Businesses in the capital who are facing serious problems should contact insolvency practitioners in London to help guide them through the process.
According to the report, while London and New York were the most expensive cities on the list, they also ranked highly in productivity and the value they add to a business.
By Phil Smith