Essentially, a rising Swiss franc has allowed Swiss retailers to quietly let margins rise relative to those in nations with weaker currencies. For more stories like this on Switzerland follow us on Facebook and Twitter. By subscribing you are agreeing to our Privacy Policy. Previous Newsletters.
By subscribing you agree to our Privacy Policy. Share this:. Related posts. A guide to what's happening in the Lake Geneva region and beyond. Advertise with us Advertise with us Contact us for a personalised offer. Quality of goods and range of goods available may be a consideration too. Our statistical office monitors the prices of consumer and capital items and can then provide the Swiss basic data. The EU statistical office coordinates these price surveys, does the calculations and publishes the results of the whole statistical survey.
It compares GDP, adjusted for per capita purchasing power, and price levels in the participating countries. The exchange rate is often forgotten about, too: how much of the foreign currency will I get for my Swiss francs at a particular point in time? For example, jeans are subject to precise criteria. Then again, the difficulty may be finding this pair of jeans everywhere. Jeans might be a typical consumer item for Belgian women, but in Greece hardly anyone buys them.
So it needs to be specified whether a given product corresponds to the usual patterns of consumption in a given country or not. Typical goods have a higher value for the statistician than niche products.
And there are other problems that come up in a worldwide comparison: not all countries want to participate or are even able to participate — countries in a crisis like Syria or Lebanon. The next survey in put Switzerland right at the top, with a price level that amounted to more than double the world average. In Switzerland was no longer the most expensive country — it was Bermuda. That can change quickly, of course, and has a lot to do with currency exchange rates. If our franc gets stronger, Switzerland is more expensive and our price level goes up.
That has to do with competition as well as with imported goods, which in Switzerland, compared with Europe, tend to become cheaper. Zurich and Geneva are in the top ten of the world's most expensive cities with Zurich, Paris and Hong Kong on top of the list.
In summary, high Swiss prices are largely down to a lack of competition, one sided, sometimes exclusive, territorial wholesale agreements on some imports, and import restrictions on products in protected industries, farm products in particular. Unfortunately, these are hard to fix.
For more stories like this on Switzerland follow us on Facebook and Twitter. So I do not see how Swiss supermarkets are going to be able to cut prices without an associated decrease in operating costs. As an Australian doctoral student who moved to Geneva in , and is paid an Australian scholarship that after exchange and foreign transaction costs is less than 20K CHF annually to live on, the prices have sickened me.
They are simply beyond my means. It cost CHF a month and was heavily subsidised because it was part of a special charity initiative to help a disadvantaged female on a low income to secure housing.
When I applied for the apartment with a carefully written letter of motivation, a carefully drafted letter of reference and recommendation by my academic supervisor, my police certificates that showed I had no criminal record in Australia or Switzerland, proof of income etc etc I was asked what my other sources of income were.
I explained that I had none and this was why this special housing scheme for poor females was so appealing to me. They advised me that my income was too low for them to rent this place to me. In Geneva, even poverty has a minimum threshold level. Salaries are not the same in all cantons, so one can not compare and justify the salary scale in Switzerland.
Specially Canton Ticino is the lowest salary recepients. Take-home salaries are also not comperable between CH and the other European countries. In rest of Europe, an employee should not pay in private for his obligatory health insurance.
This costs approx. The average swiss indeed lacks the concept of competition hence the Suppliers get away with it. Remember the CHF soaring in value but the gains only slowly benefiting Customers.
And the VAT of 8 vs. The Consumer Organisations need to wake up! And Custom Protection allows the local products to remain highly priced. Think olive tomatoes. I think Agricultural Subsidies should be in History.
The input costs faced by Swiss retailers and producers other than direct staff costs are also very high. Insurance, property rent, energy, legal costs, freight etc. It all adds up. As mentioned, Switzerland does have some cost advantages, such as lower staff costs and VAT, so there is potential offset. Some Swiss retailers seem to be getting high prices forced on them by wholesalers or the brand owner i. We are looking for research on this. When we find it we will write a piece on it.
Many thanks for your comment. What on earth is meant by this? In many countries there is a form of hidden social security charges. In Switzerland this hidden charge is low. In France for example it is high. Taking some approximate numbers the real rates are different and vary by region it works like this:. If a Swiss employer pays someone a salary of 4, per month it will cost them 4, And the employee will get paid 3, before tax.
The difference is social security charges or AVS. What is effectively happening here is the employee is getting paid 4, but only receiving 3, In France for example, the difference between the cost to employer and take-home pay is much higher.
So if an employer paid out 4, the employee would only get only 2, So the Swiss worker gets 3, and the French one only 2, From an employee perspective French employers look stingy and Swiss employers generous, when they are both paying out the same amount i. The OECD considers these payments to be taxation.
Switzerland is under the OECD average. This OECD report presents a more complete view. The last bars on the bar chart, labelled Employer SSC, are the amounts that are not visible to employees. Please not that this example is simplified and approximated.
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