A typical expat package for Middle Managers is around $2m.
Expatriate pay packages in Hong Kong have fallen to a five-year low but are still the fourth highest in the Asia Pacific region - after Japan, mainland China and India. This was one of the findings of the latest MyExpatriate Market Pay survey published annually by 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, utilities or cars – and tax. To assist companies relocating staff with benchmarking their packages against the market, ECA conducts its annual MyExpatriate Market Pay Survey of pay levels for expatriates around the world, including benefits, allowances, salary calculation methods and tax treatment.
"A major challenge faced by companies operating internationally is the need to strike a balance between attracting the right talent while remaining as cost-effective as possible," said Lee Quane, Regional director – Asia, ECA International. “Dangerous levels of air pollution, combined with high international school fees and accommodation costs, mean that companies in Hong Kong have traditionally offered generous expatriate packages to attract highly sought-after talent.”
The value of a typical expatriate package for Middle Managers in Hong Kong is around HKD 2 059 600 (USD 265 500). Even though expatriate pay packages in Hong Kong are the fourth highest in the region, they have fallen over the past five years in USD terms by two per cent.
“The most expensive part of the expatriate package in Hong Kong is typically the benefits element, to the extent that the benefits component is often much greater than the assignee's net take-home pay. While the value of benefits in Hong Kong remain significantly higher than all other locations in the region, they have fallen by five per cent since 2012 owing to rental prices in popular expatriate neighbourhoods declining,” explained Quane.
The gap has decreased between the total expatriate packages typically offered in mainland China and Hong Kong, with companies in Chinese cities providing three per cent less in USD terms than last year. A total package for an expatriate Middle Manager in China is worth around HKD 2 191 900 (USD 282 500) on average.
“Traditionally, Hong Kong has offered more lucrative packages for expatriates than China’s major cities. However, in the past few years, rising cost of living and increased pollution in China made it more challenging to attract international talent and so packages continue to rise in local terms,” stated Quane. “On the other hand, due to the yuan weakening against the dollar over this period, expatriate packages have declined in USD terms from last year’s totals. As a result, China remains attractive for foreign companies that need to send expatriates to the region as, although costs are rising in local currency, they have fallen in USD terms since our previous survey.”
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