London's bloom fades as costs rise
Surprise, surprise: when costs are taken into account, London's not quite such a great place to work after all.
Although bankers in the City are paid anything between 20% and 25% more than bankers on Wall Street, the premium is more than eroded by the spiralling cost of living.
Soaring property prices mean London is now 26% more costly than New York or Singapore and 6% dearer than Hong Kong. But last year, Hong Kong was more expensive than London and the City was a mere 11% harsher on the pocket than New York, according to Mercer Human Resource Consulting.
The result is that booming London pay packages suddenly don't look quite so appealing after all. For example, research by search firm Napier Scott suggests managing directors working in credit derivatives trading in top tier banks earn 2.1m in London vs. 1.7m in New York. But when costs are taken into account, New York-based traders are in fact marginally better off.
London's expensiveness may be beginning to bite. In response to a recent article on Wall Street bankers migrating to the City, several readers suggested Asia is now the best bet for anyone looking for cash combined with quality of life.
Guy Roberts, chief executive of headhunter Pelham Search International, says people with families are increasingly interested in shifting to Singapore, while younger bankers keener on partying and money-making head for Hong Kong: "Pay in Hong Kong is more in line with London than it used to be," he says. "But once you're there, the temptation is to stay - the top rate of tax is only 17%."
