ANALYSIS: Switzerland might be the 'world's best country' but there are downsides
Even though Switzerland was recently once again ranked the best country in the world in an international survey, not everything in the country is rosy.
For the sixth time, Switzerland placed in the number 1 spot, ahead of 87 other countries, in the US News & World Report’s 2023 ranking, which was released earlier in September.
READ ALSO: 'Pleasantly constant': Why Switzerland ranks as the 'world’s best country' — again
Predictably, the country got top marks for categories like quality of life, economic stability, business-friendliness, access to education, social conscience, safety, consistency, and environment.
As the report said, “while people may not see [Switzerland] as the sexiest place, they would like to live there."
All that is true, but this is not the whole picture.
There are also some downsides of living in the world’s ‘best’ country.
These four jump to mind:
The cost of living
Yes, Swiss wages are the highest in Europe, but so are the prices of most things.
This is especially true in Switzerland’s largest cities, the ones where foreigners usually settle because that’s where most job opportunities can be found.
Study after study shows that prices for most common goods and services like food, entertainment and public transportation in Zurich and Geneva, and sometimes also in Basel, Bern, and Lausanne, are higher than in most other major European cities.
However, an important thing to remember when thinking of high (and continually rising) costs is that this is not only happening in Switzerland but also in other countries hit by inflation and effects of war in Ukraine.
For instance, while the price of Swiss electricity will jump by 18 percent on average in 2024, it is increasing elsewhere in Europe as well (as the continent’s electrical grids are inter-connected).
However, if looked from a different perspective, there are some indications that, if you take into account the purchasing power of an average resident as compared to other nations, Switzerland is not faring badly.
READ MORE: Why Switzerland’s cost of living isn’t as high as you think
Health insurance
Switzerland’s unique (in Europe) system of private health insurance has many advantages over public models in place elsewhere in Europe — such as better access to specialists and shorter waiting times for treatments — but it is also very expensive.
READ ALSO: How is Swiss healthcare system different from the rest of Europe?
A big portion of the costs trickles down to consumers, who are faced with continually more expensive premiums of the obligatory insurance scheme.
In 2023, households and individuals were hit with an average 6.6-percent hike, though the increases were much higher in various regions.
And the rates are expected to go up again next year, straining the budgets of many mostly low and middle-income families.
The problem is so dire that politicians and consumer groups are calling for urgent reforms of the current system, ranging from a freeze on premiums and scrapping the private system in favour of a government-run scheme, to basing premiums on income.
READ ALSO: Should the cost of Switzerland's health insurance be based on income?
Housing shortage / rising rents
Because Switzerland’s population is growing (mostly due to immigration) and construction activity has slowed down, the demand for rental accommodations far exceeds the available supply.
As a result, there is a housing shortage in and near many cities, and the situation is expected to worsen.
At the same time, rents are increasing as well — not just due to scarcity of available housing, but also because of rising reference rates, on which rents are based.
From October, about 1 million Swiss households — all those whose leases are based on the reference rate — will be hit with a 5-percent rent hike, a situation that Swiss Tenants Association (ASLOCA) calls a “social time bomb.”
In fact, this development had already sparked social unrest earlier this year, when more than 1,000 people took to the streets of Zurich to demonstrate against the shortage of affordable housing in Switzerland’s most expensive city.
Gender pay gap
Data from the Federal Statistical Office (FSO) sheds light on the gap in salaries between men and women in Switzerland.
By comparing the gross income in 2022, the FSO found that women earned 11,500 francs less than men employed in comparable positions.
The difference in income is greatest in higher-level occupations: there, males employed in management positions earned "significantly more" than their female counterparts.
But here, again, this is not a specifically ‘Swiss’ problem: European data indicates that Austria’s wage gap is even wider than Switzerland’s which, in turn is equal to Germany’s.
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For the sixth time, Switzerland placed in the number 1 spot, ahead of 87 other countries, in the US News & World Report’s 2023 ranking, which was released earlier in September.
READ ALSO: 'Pleasantly constant': Why Switzerland ranks as the 'world’s best country' — again
Predictably, the country got top marks for categories like quality of life, economic stability, business-friendliness, access to education, social conscience, safety, consistency, and environment.
As the report said, “while people may not see [Switzerland] as the sexiest place, they would like to live there."
All that is true, but this is not the whole picture.
There are also some downsides of living in the world’s ‘best’ country.
These four jump to mind:
The cost of living
Yes, Swiss wages are the highest in Europe, but so are the prices of most things.
This is especially true in Switzerland’s largest cities, the ones where foreigners usually settle because that’s where most job opportunities can be found.
Study after study shows that prices for most common goods and services like food, entertainment and public transportation in Zurich and Geneva, and sometimes also in Basel, Bern, and Lausanne, are higher than in most other major European cities.
However, an important thing to remember when thinking of high (and continually rising) costs is that this is not only happening in Switzerland but also in other countries hit by inflation and effects of war in Ukraine.
For instance, while the price of Swiss electricity will jump by 18 percent on average in 2024, it is increasing elsewhere in Europe as well (as the continent’s electrical grids are inter-connected).
However, if looked from a different perspective, there are some indications that, if you take into account the purchasing power of an average resident as compared to other nations, Switzerland is not faring badly.
READ MORE: Why Switzerland’s cost of living isn’t as high as you think
Health insurance
Switzerland’s unique (in Europe) system of private health insurance has many advantages over public models in place elsewhere in Europe — such as better access to specialists and shorter waiting times for treatments — but it is also very expensive.
READ ALSO: How is Swiss healthcare system different from the rest of Europe?
A big portion of the costs trickles down to consumers, who are faced with continually more expensive premiums of the obligatory insurance scheme.
In 2023, households and individuals were hit with an average 6.6-percent hike, though the increases were much higher in various regions.
And the rates are expected to go up again next year, straining the budgets of many mostly low and middle-income families.
The problem is so dire that politicians and consumer groups are calling for urgent reforms of the current system, ranging from a freeze on premiums and scrapping the private system in favour of a government-run scheme, to basing premiums on income.
READ ALSO: Should the cost of Switzerland's health insurance be based on income?
Housing shortage / rising rents
Because Switzerland’s population is growing (mostly due to immigration) and construction activity has slowed down, the demand for rental accommodations far exceeds the available supply.
As a result, there is a housing shortage in and near many cities, and the situation is expected to worsen.
At the same time, rents are increasing as well — not just due to scarcity of available housing, but also because of rising reference rates, on which rents are based.
From October, about 1 million Swiss households — all those whose leases are based on the reference rate — will be hit with a 5-percent rent hike, a situation that Swiss Tenants Association (ASLOCA) calls a “social time bomb.”
In fact, this development had already sparked social unrest earlier this year, when more than 1,000 people took to the streets of Zurich to demonstrate against the shortage of affordable housing in Switzerland’s most expensive city.
Gender pay gap
Data from the Federal Statistical Office (FSO) sheds light on the gap in salaries between men and women in Switzerland.
By comparing the gross income in 2022, the FSO found that women earned 11,500 francs less than men employed in comparable positions.
The difference in income is greatest in higher-level occupations: there, males employed in management positions earned "significantly more" than their female counterparts.
But here, again, this is not a specifically ‘Swiss’ problem: European data indicates that Austria’s wage gap is even wider than Switzerland’s which, in turn is equal to Germany’s.
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