Some expat destinations score more than others when it comes to career opportunities, salaries, and perks. In this article we will discuss the latest expat pay packages trends as presented by consultancy ECA, an expert in global mobility data and solutions, and what you should be looking for when reviewing your contract and making the decision to accept or not a job offer abroad. So, before you jump into the first hefty salary that comes your way, bear in mind the wisdom behind the saying that every rose has its thorn.
What is an expat package?
Apart from the annual salary, expat packages include different types of allowances, such as housing allowance, allowance for transportation, and for international school fees. Depending on the employer's generosity, the level of the position, and the location of the job, expat packages can also provide health insurance subsidies, a one-off amount to cover your relocation expenses, and even family support, which includes practical advice on helping your spouse finding a job in the new country.
Open-handed companies will assess your situation in your home country, and if you are a homeowner, they will pay for a property management company to look after and rent out your place while you are working abroad. Also, as most employers who invest in global mobility want to keep their employees happy (hence productive), they will fly you and your family back home once a year — on business or first class if your position allows.
In addition to housing benefits, some companies may even cover the costs of a short trip to test the waters before you sign the contract. During this assessment trip, you are expected to visit the offices of your potential employer, check out the lifestyle in the destination, and house-hunt for a permanent residence. This trip is particularly useful to employees who are moving with their families, meaning that they will also need to find an international school for their children.
Other smaller but not insignificant allowances are for a gym membership, foreign language classes, and cultural advice. All these little contributions will help you adjust to your new lifestyle, and create a social network which can be a great support during your stay abroad.
Last but not least, some locations are categorised as “unsafe,” and employees moving there are also entitled to security allowance, which may include a driver, security staff, and even an armoured vehicle. In any case, remember that packages vary from one company to another, and for the most part your premium depends on the seniority of your position.
Which countries pay the highest expat packages?
According to ECA's latest survey in 160 countries, for the fifth consequent year, the UK offers the highest annual expat pay packages ($421,798). Second on the list comes Japan ($386,451), followed by China ($310,204). Overall, if it weren't for Shanghai's excessive salaries and perks, China's average would have been much lower than the current figure. However, it appears that companies in China's biggest city, are willing to pay the highest packages than any other city in the world to maintain Shanghai's status as a global financial hub. On fourth place is India ($299,728), followed by Hong Kong ($276,417), Australia ($266,848), South Korea ($265,000), and France ($264,500).
The downsides of the top 5 well-paying destinations
Whereas expat employees in the UK are the best-paid, especially those in the IT and AI sectors, one should keep in mind that there's a certain level of uncertainty for the future with Brexit on the horizon. However, even if payments remain as high as they currently are, expats moving to the UK must also consider the extremely high cost of living in major cities such as London, Oxford, and Cambridge.
Japan is an attractive expat destination, especially for adventurous and young professionals who are looking to explore a different culture while boosting their career development. However, the hefty packages come with long working hours and unusually demanding work mores, which don't always take into account the social and family life. This is not to say that you won't enjoy your time in Japan; as long as you are prepared for the less bright (and often unspoken) side of your contract.
As mentioned above, China's third position is mainly thanks to companies in Shanghai which are willing to pay huge sums to bring skilled international professionals. Expat packages in other cities aren't as high, but for many, they act as a stepping stone towards a better contract.
India is counting vastly on global talent. However, before moving to the country, you should ask yourself whether you are prepared to welcome the challenges of living in India. Some of the difficulties in question are high pollution levels, overcrowded spaces, traffic congestion, underdeveloped infrastructure, and sanitation issues.
Similarly to the UK, Hong Kong is among the world's most expensive places to live in. Thus, you should be ready to accept the fact that your big salary may not allow for as many savings as you were initially planning for. Also, it is widely agreed that employees in Hong Kong work hard, meaning long hours and a limited amount of holidays and sick days.
To sign or not to sign
Besides career development and the desire to explore a new country, https://www.expat.compensation packages are crucial to deciding whether a job is worth it swapping the life you are familiar with, with the unknown. It is essential to assess all aspects of your offer, and ask yourself whether the given money is enough to cover your expat needs such as relocation, healthcare, and an annual visit back home.
To better understand the context of the given destination, and what it means to earn an X amount of money in a specific location, we recommend you connect with other professional expats via forums, and gain information about the cost of living (e.g., petrol costs, shopping, rentals), international school fees, and access to healthcare.
As the world is becoming more globalised, and emerging economies are catching up with (and even surpassing) the progress of the developed countries, we observe a fall in expat contracts, as opposed to a rise in the hiring of competent local workforce in senior positions. Also, expat packages tend to be less luxurious and more down to earth. To cut costs, companies openly show their preference towards solo professionals for whom employers don't have to cover the costs of school fees and family relocation.
