Working Shanghainese and Beijingers not only find themselves earning much less than other international cities but also their purchasing power falls bottom of the list, according to a study conducted by a Swiss bank.
The study released in early August by UBS Wealth Management Research placed Shanghai at 61 and Beijing 63 for purchasing power on its “prices and earnings” survey.
Employees in Shanghai have to work 30 minutes on average to buy a Big Mac from McDonald’s while those in London only need to work 13 minutes, the survey found.
The study compares prices and earnings in 73 cities worldwide for 122 goods and services in three categories – price levels, wage levels and domestic purchasing power.
Lai Chee-kwong, a Shanghai analyst from Ernest and Young, told the Global Times Thursday despite rocketing economic growth rates in China, buying power in Shanghai and Beijing remained low.
“The housing prices in Shanghai and Beijing are much higher compared to other international cities in North America and Europe,” Lai said.
Wage levels in Shanghai and Beijing are still among the less-developed country cluster, he said, despite inflation. The consumer price index in July rose to a 37-month high at 6.5 percent, and food prices were one of the main contributors to the hike, according to the National Bureau of Statistics.
UBS said in the survey that wage levels reflect the wealth gap between the rich and the poor of a country. European and American countries have a smaller gap as social security subsidizes the poor whereas many Asian countries lose out on the average wage for that very reason.