Why do foreign workers flock to Switzerland?
Despite its notoriously high cost of living, an increasing number of foreign nationals seek employment in Switzerland, whether they are cross-border workers or Swiss residents. Why is this?
The latest numbers released by the Federal Statistical Office (FSO) on Thursday indicate that between the third quarter of 2021 and 2022 (July to September), the number of foreign nationals employed in Switzerland went up by 3.7 percent.
Among these workers, the increase was the strongest among holders of a short-term residence L permit (+7.9 percent), followed by residence permit B (+7.7 percent), and cross-border workers G permit holders (+5.9 percent).
Even though Switzerland — and its two largest cities, Zurich and Geneva — are among the world’s most expensive places to live, the demand for Swiss work permits is not slowing down.
What is Switzerland’s appeal to foreign nationals?
The reasons seem clearest for cross-border G-permit holders.
As these employees work in Switzerland but live in the their home countries, they can enjoy the benefits such as higher salaries and lower taxes without the disadvantage of having to pay Swiss prices.
There is plenty of anecdotal evidence indicating that French, Italian, German, and Austrian citizens prefer to work for a higher pay in Switzerland.
In one case reported by The Local, one employer who runs a plumbing business in the French commune of Saint-Julien-en-Genevois, which is located right on the border with the canton of Geneva, said he couldn’t find any employees to hire as "everyone wants to work in Switzerland".
This disparity in Swiss and French wages was also made clear by another French citizen, Kévin Lecoq, who makes a daily cross-border trek to the Swiss canton of Jura.
“If we add up everything that has to be paid in taxes, we still have one and a half times the French salary,” he said.
What about permanent foreign residents?
The group of permanent foreign residents, as the FSO survey shows, increased by 3.7 percent between the third quarter of 2021 and the same period this year.
Unlike cross border-workers, who earn money in Switzerland but spend it in their (cheaper) home countries, permanent residents must live on their wages right here.
So why do increasing numbers of them want to work in Switzerland?
There are several reasons:
Of course, money is a big draw. Swiss wages are among the highest in Europe and even the world. True, the high — and growing — cost of living eats up a lot of people's wages, especially for fixed expenditures such as rent / mortgage, health insurance premiums, energy, food, transport, clothing, and taxes.
But studies show that there is still enough of it left (especially for high earners) to enjoy a good life.
An in depth analysis by a digital employment platform Glassdoor provides some interesting and no doubt surprising insights into Switzerland’s purchasing power parity in comparison with other nations.
"Taking not only income and cost of living into account, but also the effects of differences in taxation, it is possible to derive an indication of after-tax, local purchasing-power-based, standard of living," the study reported.
“On this basis, the highest overall standard of living is found in the cities of Switzerland, Denmark, and Germany. Although the cost of living can be relatively high in these countries, so are average wages and purchasing power”.
Switzerland has a strong pro-employee legislation, with provisions for vacation, time off, sick leave, and other workplace-related situations that is more flexible and generous than in many other countries, especially the United States.
No company can act unilaterally or arbitrarily; all circumstances are covered by either the law, collective employment agreement, or individual work contract.
Quality of life
You have probably read by now countless articles about how Switzerland consistently rates among the top nations in terms of quality of life.
In fact, in September 2022, Switzerland was ranked “the best country in the world” by US News & World Report.
The survey explained such a high score thus: “Beyond the essential ideas of broad access to food, housing, quality education, health care and employment, quality of life may also include intangibles such as job security, political stability, individual freedom and environmental quality."
Did anything else prompt you to find a job in Switzerland? If so, let us know.