Dubai and Abu Dhabi cost-of-living surges in global rankings

UAEDubai and Abu Dhabi cost-of-living surges in global rankings

Dubai and Abu Dhabi cost-of-living surges in global rankings

According to Mercer’s Cost of Living 2023 survey, Dubai and Abu Dhabi’s cost-of-living surges in global rankings have increased. Abu Dhabi is now in rank 43, while Dubai is currently in position 18. Despite these adjustments, the UAE’s economy shows strong growth and adaptability, indicating a bright future.

Increase in Rental Price

The sharp increase in rental prices is one of the main elements influencing the rankings adjustments. With an average rent increase of 25%, Dubai is the second city after Singapore, where rental costs have significantly impacted rankings.

In contrast, Abu Dhabi has seen less change in the housing market, with variations between 6 and 8 per cent or, in some places, no change from the previous year.
The survey also shows that the cost of living has gone up in other areas in both cities, such as food in supermarkets (up to 11%), transportation (4%), and sports and recreation (5%).

Four amazing facts about Dubai metro


Vladimir Vrzhovski, Financial Services and Technology Industries Lead at Mercer Middle East, said that employers in the UAE are taking note of these changes adding that organizations have provided an average annual merit increase of 4.2 per cent in 2023.

“Many of them are reviewing their remuneration packages, with a growing number increasing bonuses instead of increasing base salaries to increase the total compensation without a long-term commitment. Our research shows that as a response, 40 per cent of the surveyed organizations have reviewed their 2023 policies by increasing their housing allowances on average by 5-10 per cent based on the career level,” he said.


However, moving up the rankings, the UAE’s cost of living is still reasonable compared to the major cities worldwide. Inflation, fluctuating exchange rates, and housing costs influence these changes. The UAE has taken the initiative to address these problems, demonstrating its robust economic resiliency.

Globally, Singapore has moved up from eighth place to second place, surpassing Hong Kong as the most expensive city for expatriates. New York has increased one spot in the rankings, while London and Amsterdam have fallen a few points.

Renting in Dubai

Growing Economy

While the advantages of a growing economy, Vladimir Vrzhovski also said that the survey shows that the same problems affecting the global economy in 2022 will still be present in 2023.

“Despite the advantages of a developing economy, the study reveals that essential variables that have formed it since 2022 will continue to have an impact in 2023, with inflation and exchange-rate fluctuations directly impacting the salaries and savings of globally mobile personnel. The World Economic Forum (WEF) and Marsh McLennan’s 2023 Global Threats Report also show that the cost of living crisis is one of the most severe threats viewed by national governments and enterprises worldwide. He said that the public and private sectors must contribute to the drive to reduce prices.


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