20th July 2020
International contracting can provide lucrative opportunities for experts that are willing and able to make the move overseas for work. But any relocation comes with a financial cost that certainly needs to be weighed up with the remuneration on offer. For those planning future moves overseas, here are the top destinations with the highest cost of living for 2020 so far, as recorded by the world’s largest cost of living database, Numbeo.
The 10 destinations with the highest cost of living for contractors
Renowned for its pink sandy beaches and warm climate, there’s no doubt that Bermuda has a lot of appeal for contractors making a move overseas. However, the British Island Territory topped the list of expensive places to live, with the average cost to rent a one-bedroom property per month standing at around $2,389.
But it is still a destination that holds a lot of potential for contractors. And as of the beginning of July, many of the travel restrictions to the destination had been lifted, with the UK, for example, no longer advising against all but essential travel to Bermuda, making it much easier for contractors to travel to the islands for work. However, it’s important to note that Covid-19 has had a real impact on contract hiring, with reports from the Royal Gazette revealing that almost 160 applications for work-permit renewals were denied during the pandemic. While this may change as businesses struggle to find the resources needed to complete projects, it’s worth bearing this in mind when seeking an opportunity here.
Second on the list, a move to Switzerland could certainly have an impact on your wallet. Numbeo estimates that the average cost of living in this destination is 90% higher than in the UK, with rent costing around 28% more in Switzerland than in the United States.
However, as a recognised tech hub, it’s certainly a destination of choice for specialist technology, digital and IT contractors. For those experts looking to take up work here now, though, the on-going pandemic has certainly created some challenges. While lockdown measures were eased in June, there are talks of numerous Swiss cantons reintroducing restrictions as cases spike. What is encouraging, though, is that with more employers introducing steps to allow contract staff to work remotely from their home country – and the tech arena arguably being the best prepared for this move of all the sectors – professionals can still tap into opportunities in Switzerland, without necessarily being impacted by the high cost of living.
While Norway is third on the list in terms of its overall cost of living, there are some things in the country that are relatively inexpensive. Electricity, gym memberships, internet and renting, for example, can actually be relatively cheap in the Nordic country.
Encouragingly, for those experts looking at making a move to Norway in the immediate future, the country’s lifting of lockdown has meant its economy has slowly but surely begun to rebound, with Statistics Norway reporting the mainland economy actually grew between April and May.
The Nordic Island country has long been known as an expensive destination to live, so it’s perhaps no surprise to find it fourth on the list. Contractors looking at temporarily relocating to this destination will certainly need to ensure any remuneration package factors in the high cost of living, with rental for just a single room setting you back on average 50,000 ISK per month (approximately £250).
However, Iceland does present a number of opportunities for contract professionals, particularly those within the pharmaceutical field. But with the country reporting very little impact from the Coronavirus and no real lockdown imposed, it’s certainly a destination to consider despite the high cost of living.
With Japan officially ending its state of emergency and the spread of Covid-19 seemingly under control across most of the country, it’s perhaps no surprise that it has once again become a destination of interest for international contractors. The cost of living here, though, is relatively high. Nationwide, the average cost of rent for a one-bedroom apartment sits between 50,000 and 70,000 yen, but this does vary significantly depending on the location. Tokyo, for example is much more expensive and could set you back 100,000 yen per month (around £750).
The Scandinavian country has a reputation as one of the best destinations to live for contractors in terms of quality of life, so it’s no wonder that so many choose to make a move here. But quality certainly seems to come with a price, with Denmark sixth on Numbeo’s list of high cost locations. As with Japan, though, this does vary across the country. Living in Copenhagen, for example, will be much more expensive than setting up residence in some of the smaller towns, so it’s definitely worth considering where you plan to be based when taking up an opportunity here.
Reassuringly for anyone looking to move soon, Denmark is one of the global destinations that has been hallmarked as a country that’s winning the battle against Covid-19, with many lockdown restrictions now lifted.
While it remains one of the country’s that is still struggling to keep Coronavirus infections under control, with cases jumping once again, Luxembourg is a destination that contractors should certainly keep an eye on for future opportunities. Before the pandemic, it was a leading location for financial services and IT experts, amongst others. But as the seventh most expensive place in terms of cost of living, planning a move here in the future could be costly, though it is reportedly cheaper than New York.
As another destination with an appealing climate, sandy beaches and tempting oceans, the Bahamas certainly holds its own appeal for those moving across borders for work. But while the standard of living on these islands is high, so too are the costs. Accommodation and utilities prices are relatively high in the destination, with many day-to-day products and groceries costing more due to the need to import all goods.
Contracting opportunities here have proven lucrative in the past, but with the islands facing fresh Coronavirus spikes, opportunities could soon be limited again should a lockdown be re-introduced.
Ninth on the list, Israel is considered to be one of the most expensive destinations in the Middle East. But with a wealth of technology and pharmaceutical businesses operating here that are in need of expertise that simply cannot be sourced in-country, opportunities for contractors have previously been plentiful. Covid-19 has certainly impacted this recently, though, with the country now returning to a partial lockdown due to a surge in cases.
The last in the Numbeo top ten high cost countries to live has long held a reputation as an expensive destination for expats. But opportunities here are both lucrative and plentiful, with high demand for international expertise across the country. While the economy has been hit hard by the pandemic, as one of the destinations to have already lifted lockdown restrictions – with many people now back at work – it’s certainly a place to keep an eye on.
Contractors need to consider more than the cost of living
While the financial impact of a move overseas certainly plays a key role in a decision, contractors do need to factor in more than just the cost of living when planning budgets for a move across borders. The potential fines that you could face as a result of non-compliance with local tax legislation makes ensuring you remain on the right side of the law crucial, no matter where you are based. And with more employers encouraging contract professionals to work remotely from their home country as global lockdown’s limit travel, the complexity of tax compliance intensifies.
The team here at 6CATS International has extensive compliance experience across the globe. Find out how we can help you with your next assignment today.