H E A LT H W E A LT H C A R E E R

I N T E R N A T I O N A L L I V I N G W A G E R E P O R T 2015

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PUBLICATIONS DIRECTORSamantha Polovina

CREATIVE DIRECTORStefani Baldwin

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PRODUCTION MANAGERSumit Bajaj

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CONTRIBUTORGennaro Pica

ANALYSTSDeepak Gaur

Rishi Kumar

Sunil Kaushal

Vinay Pathania

Vishal Singla

WRITERSAashi Choudhary

Virginia McMorrow

COPYEDITORShubham Bhatnagar

DESIGNERSAshish Mathew

Nidhi Shrivastava

Vishal Kapoor

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Copyright © 2015. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or be transmitted in any form or by any means, electronic or mechanical, photocopying, recording or otherwise, without the prior written permission of the publishers. No responsibility for loss occurring to any person acting or refraining from acting as a result of the material in this publication can be accepted by the authors or the publishers.

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D A T A M I N I N G & I N S I G H T SIn today’s competitive race to attract and retain highly skilled global talent, organisations require current, in-depth information on everything from local statutory benefits, to salary trends, to managing a diverse workforce. Through Mercer’s own extensive global presence, we collect and analyse data and insights that help companies take the actions necessary to support their human capital strategies. You can order any of the publications below by clicking on the title links or by visiting www.imercer.com/global.

Compensation Handbook

Global Car Policies

Global HR Factbook

HR Management Terms

Short-Term Incentives around

the World

Global Mobility Handbook

International Geographic Salary

Differentials

Global Compensation

Planning Report

Global Pay Summary

M&A HR Issues Around the World

Total Employment Costs around

the World

Worldwide Benefit & Employment

Guidelines

Talent All Access Portal

Subscription Services

Global Diversity and Inclusions

Handbook

HR Atlas Asia Pacific

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T A B L E O F C O N T E N T S

INTRODUCTION 5

SUMMARY OF KEY FINDINGS

10

ABOUT THIS REPORT 178

METHODOLOGY 179

GLOSSARY 190

ABOUT MERCER 192

AFR

ICA CAMEROON 20

CÔTE D'IVOIRE 22

EGYPT 24

GHANA 26

KENYA 28

MOROCCO 30

NIGERIA 32

SOUTH AFRICA 34

TUNISIA 36

AM

ER

ICA

S ARGENTINA 39

BOLIVIA 41

BRAZIL 43

CANADA 45

CHILE 47

COLOMBIA 49

COSTA RICA 51

DOMINICAN REPUBLIC 53

ECUADOR 55

GUATEMALA 57

MEXICO 59

PANAMA 61

PERU 63

PUERTO RICO 65

TRINIDAD AND TOBAGO 67

UNITED STATES 69

URUGUAY 72

VENEZUELA 74

AS

IA P

AC

IFIC AUSTRALIA 77

CHINA 79

HONG KONG 81

INDIA 83

INDONESIA 85

JAPAN 87

MALAYSIA 89

NEW ZEALAND 91

PAKISTAN 93

PHILIPPINES 95

SINGAPORE 97

SOUTH KOREA 99

TAIWAN 101

THAILAND 103

VIETNAM 105

CE

NT

RA

L A

ND

EA

ST

ER

N E

UR

OP

E BULGARIA 108

CROATIA 110

CZECH REPUBLIC 112

HUNGARY 114

KAZAKHSTAN 116

LITHUANIA 118

POLAND 120

ROMANIA 122

RUSSIA 124

SERBIA 126

SLOVAKIA 128

SLOVENIA 130

TURKEY 132

UKRAINE 134

MID

DLE

EA

ST ISRAEL 137

SAUDI ARABIA 139

UNITED ARAB EMIRATES

141

WE

ST

ER

N E

UR

OP

E AUSTRIA 144

BELGIUM 146

DENMARK 148

FINLAND 150

FRANCE 152

GERMANY 154

GREECE 156

IRELAND 158

ITALY 160

LUXEMBOURG 162

NETHERLANDS 164

NORWAY 166

PORTUGAL 168

SPAIN 170

SWEDEN 172

SWITZERLAND 174

UNITED KINGDOM 176SAMPLE

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I N T R O D U C T I O NSAMPLE

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GLOBAL LIVING WAGES: CREATING AN APPROPRIATE STANDARD OF LIVINGIt has been a tough few years for the world’s lowest-paid workers. As the effects of the global financial downturn lingered, wage increases have been thin on the ground (even nonexistent), while the cost of living has crept inexorably upwards.

But now that economies are entering a period of fragile growth, HR can refocus on employee pay and — with Mercer’s approach to creating a living wage — make a positive impact on employees’ standard of living. For organisations that want to be socially responsible to ensure the health, wealth, and careers of their employee base, a living wage is critical to ensure a sustainable lifestyle at all employee income levels.

VARIOUS DEFINITIONS OF A LIVING WAGEThe last few years have seen a revival of interest in establishing a foundation of decent and fair wages for employees on low incomes on an organisation-wide basis. As corporations experience relative economic optimism, they increasingly focus on issues of sustainability, decency, and corporate social responsibility. Many organisations cite the need to establish standards of decency in the way they interact with the communities in which they operate as central to their future purpose and the sense of purpose sought by employees. The goal of determining a global living wage is rarely a goal in itself, but one of a suite of measures established by globally responsible employees.

Under the United Nations’ Universal Declaration of Human Rights, “Everyone who works has the right to just and favourable remuneration ensuring for himself and for his family an existence worthy of human dignity.” The International Labour Organisation (ILO) supports this statement — under Conventions 95 and 131 and Recommendations 131 and 135 — by holding that “wages and benefits paid for a standard of working should meet at least legal or industry minimum wage standards and always be sufficient to meet basic needs of workers and their families and to provide discretionary income.”

SIGNIFICANCE OF LIVING WAGE FOR BUSINESSAlthough implementation of a living wage is voluntary, organisations in certain countries — the UK, Ireland, Canada, the US, and parts of Asia — have adopted the living wage concept, while Portugal, France, Austria, and Japan are actively exploring its use. Many living wage reevaluations are part of a broader array of employer-led initiatives to engage the current workforce, understand their needs and aspirations, and appeal to the heightened sense of purpose of the younger workforce.

The living wage, under the spotlight more than ever, may be one of the rare, genuine win–win opportunities for employers and employees for the following reasons:

GOOD COMPANY REPUTATION

How well companies pay employees (in particular, those at the lower levels) can enhance or damage the corporate brand. Against the backdrop of 24/7 news and social media, the growing emphasis on corporate social responsibility plays a large part in management decisions. So, too,

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does management’s concerns about other potential indirect risks (for example, poor organisational performance and customer dissatisfaction) from systematically paying low salaries.

HIGHER STANDARD OF LIVING

The workforce is better off financially, enjoying a higher standard of living. Using their increased income on essential goods and services, employees become even greater consumers. Since consumption is a great driver of economic growth, businesses as a whole have the opportunity to benefit. Some employees may even find, for the first time, discretionary income to save in the company retirement plan.

ENGAGED EMPLOYEES

A good living wage is a full-time wage that supports the purchase of appropriate goods and services The living wage can become an important part of the employee value proposition — the sum total of the reward programme — that builds a stronger sense of purpose among all employees.

REDUCED COSTS

Living wages can support cost reduction through decreased employee absenteeism, increased staff engagement, improved retention, and boosted productivity. All of which, ultimately, can lower HR costs on recruitment, orientation, and training.

REPORT STRUCTUREThis global publication covers 272 cities in 76 countries and contains three core pieces of information that relate to living wages:

1. LIVING WAGE This amount represents the annual cost of living in a specific city. The report provides amounts for a family size of one, as well as a family size of four, for each city listed within each country.

2. MINIMUM WAGE Some countries set one minimum wage for all locations, while others set minimum wages that vary by region, province, state, industry, level of experience, and so on. The report provides amounts for each country and city.

3. GUARANTEED CASH This market data reflects pay amounts for lower level positions in each country and city, according to Mercer’s Total Remuneration Surveys.

The report is organised by region and by country. Each country includes two pages of information describing the following:

ECONOMIC TRENDS This information includes inflation (annual average change), gross domestic product (GDP) annual average change, and unemployment for 2015 and 2016. It also includes, where available, the hourly and monthly minimum wages for the country.

LIVING WAGE, MARKET DATA, AND MINIMUM WAGE ANALYSIS This information includes a data table (Wage Data by City) with minimum and living wages by city, as well as guaranteed cash amounts paid to lower level employees. An accompanying graph (Wage

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Data by City and Country) also helps quickly identify locations where living costs may be higher than the pay received by some employees.

For more information on the content for each country, including methodology, data sources, and a glossary of terms, please refer to the About This Report section.

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U N I T E D K I N G D O M

WAGE DATA BY CITY AND COUNTRY, UNITED KINGDOM, 2015

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

LIVING WAGE FOR A FAMILY SIZE OF ONE

LIVING WAGE FOR A FAMILY SIZE OF FOUR

NATIONAL GUARANTEED CASH, MARKET DATA FOR LOWER TO UPPER QUARTILE

NATIONAL MINIMUM WAGE

Note: All amounts are in local currency.

READING THE REPORT

COUNTRY TABLES

COUNTRY GRAPHS

This band represents the lower to upper quartile range of market guaranteed cash data for the country.

Cities with a living wage higher than the guaranteed cash range may pose a problem for employers and employees.

This line indicates the minimum wage for the country. In this case, the living wage for all cities is higher than the minimum wage.

Note: Annual local currency figures are displayed. Sources: Mercer’s Cost-of-Living Data, Mercer’s Total Remuneration Survey Data.

178International Living Wage Report© 2015 MERCER LLC.

U N I T E D K I N G D O M

ECONOMIC TRENDS

LIVING WAGE, MARKET DATA, AND MINIMUM WAGE ANALYSIS

2015: 2.5%

2016: 2.2%

2015: 0.1%

2016: 1.5%

2015: 5.6%

2016: 5.5%

INFLATION, ANNUAL AVERAGE CHANGE

GDP, ANNUAL AVERAGE CHANGE

UNEMPLOYMENT

Employees in Jersey, London Central, and London Metro may struggle to meet their monthly expenses, as the living wage is higher than the market data guaranteed cash amount.

WAGE DATA BY CITY, UNITED KINGDOM, 2015

CITYMINIMUM

WAGE

AVERAGE LIVING WAGE GUARANTEED CASH

FAMILY OF ONEFAMILY OF

FOURLOWER

QUARTILEMEDIAN

UPPER QUARTILE

Aberdeen 13,065 5,930 21,952 16,490 19,370 22,233

Belfast 13,065 5,164 18,709 16,320 18,350 22,687

Birmingham 13,065 5,489 20,114 16,724 18,757 21,843

Bristol 13,065 5,501 20,133 15,833 19,232 23,536

Cardiff 13,065 5,540 18,939 15,676 17,657 21,087

Edinburgh 13,065 5,484 20,070 16,490 19,370 22,233

Glasgow 13,065 5,382 19,650 16,490 19,370 22,233

Jersey 13,065 6,701 25,177 15,833 19,232 23,536

Liverpool 13,065 5,620 20,654 16,481 19,313 22,128

London Central 13,065 8,865 34,046 19,243 21,361 23,896

London Metro 13,065 6,835 25,841 19,243 21,361 23,896

Manchester 13,065 5,639 20,742 16,481 19,313 22,128

Newcastle 13,065 5,470 19,636 15,556 18,611 21,493

Northampton 13,065 5,362 19,495 16,687 19,314 22,923

Norwich 13,065 5,508 20,175 16,981 19,286 22,130

Oxford 13,065 5,706 20,981 17,659 20,292 23,011

Southampton 13,065 5,516 20,216 17,659 20,292 23,011

Hourly: 6.70

Monthly: —

Note: Annual local currency figures are displayed. Sources: Mercer’s Cost-of-Living Data, Mercer’s Total Remuneration Survey Data.

MINIMUM WAGE, LOCAL CURRENCY

Annual guaranteed cash amount paid to a lower level employee, based on the local market.

Average annual living wage for a family of four.

All amounts are reported in local currency.

Average annual living wage for a family of one.Annual minimum wage

for each city.

I N T R O D U C T I O N

The green area of each column represents the living wage for a family of four in each city.

The purple area of each column represents the living wage for one person in each city.

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A M E R I C A SSAMPLE

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P E R U

ECONOMIC TRENDS

LIVING WAGE, MARKET DATA, AND MINIMUM WAGE ANALYSIS

2015: 2.4%

2016: 3.3%

2015: 3.2%

2016: 2.8%

2015: 6.0%

2016: 6.0%

INFLATION, ANNUAL AVERAGE CHANGE

GDP, ANNUAL AVERAGE CHANGE

UNEMPLOYMENT

Employees in Lima may struggle to meet their monthly expenses, as the living wage is higher than the market data guaranteed cash amount.

WAGE DATA BY CITY, PERU, 2015

Note: Annual local currency figures are displayed. Sources: Mercer’s Cost-of-Living Data, Mercer’s Total Remuneration Survey Data.

CITYMINIMUM

WAGE

AVERAGE LIVING WAGE GUARANTEED CASH

FAMILY OF ONEFAMILY OF

FOURLOWER

QUARTILEMEDIAN

UPPER QUARTILE

Lima 9,000 3,205 28,420 13,376 18,204 26,642

Hourly: —

Monthly: 750.00

MINIMUM WAGE, LOCAL CURRENCY

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P E R U

WAGE DATA BY CITY AND COUNTRY, PERU, 2015

0

5,000

10,000

15,000

20,000

25,000

30,000

Lima

LIVING WAGE FOR A FAMILY SIZE OF ONE

LIVING WAGE FOR A FAMILY SIZE OF FOUR

NATIONAL GUARANTEED CASH, MARKET DATA FOR LOWER TO UPPER QUARTILE

NATIONAL MINIMUM WAGE

Note: All amounts are in local currency.

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METHODOLOGY

LIVING WAGE METHODOLOGY

The living wage used government consumer expenditure data to derive the goods and services and housing consumption. The methodology then applied local personal income tax to obtain the income at which the consumer will begin to save. Based on this disposable income, the process created a local city level budget. All living wages are in local currency.

MINIMUM WAGE METHODOLOGY

All minimum wages reported were obtained from online sources, and, where possible, figures obtained directly from the source were used. The methodology used in the calculation of hourly, monthly, or annual amounts was based on Mercer’s local market knowledge or information found on the source website. The details of these calculations, as well as the source for each country, appear in the Source Information by Country tables on the following pages. All minimum wages are in local currency.

GUARANTEED CASH METHODOLOGY

The source for all guaranteed cash data was Mercer’s local Total Remuneration Surveys. Data represent the lowest position class (PC) available for each country and, where possible, amounts vary based on city or regional data. If city or regional data were not available, the methodology used country data.

The statistics included are as follows:

• Lower Quartile: 25th percentile; regressed and organisation weighted.

• Median: 50th percentile; regressed and organisation weighted.

• Upper Quartile: 25th percentile; regressed and organisation weighted.

The details of currency, PC, and survey source for each country appear in the Source Information by Country tables on the following pages. All guaranteed cash amounts are in local currency.

A B O U T T H I S R E P O R T

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Mercer is a global consulting leader in talent, health, retirement, and investments. Mercer helps clients around the world advance the health, wealth, and performance of their most vital asset — their people. Mercer’s 20,500+ employees are based in more than 40 countries, and we operate in more than 140 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE:MMC), a global team of professional services companies offering clients advice and solutions in the areas of risk, strategy, and human capital.

A B O U T M E R C E R

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