From its high living standards and wages to equally high costs, many expats would describe Canton Zurich (and Switzerland as a whole) as a bubble. Now, a new report from the Zurich Department of Economic Affairs has revealed that quality of life and wages in the canton have increased significantly in the last few decades.

Canton Zurich sees rising salaries and falling working hours

In the report, the department argued that due to economic growth, quality of life and disposable income among people in Canton Zurich has increased in recent years. Since 1984, the gross domestic product of the region has risen from 74 to 159 billion francs when adjusted for inflation, with annual per capita output rising from 65.000 to 101.000 Swiss francs.

The report noted that “most” of this economic growth has been paid out to residents in the form of higher salaries, with the canton maintaining some of the highest wage rates in Switzerland. While salaries are rising, the annual average working hours for staff in Zurich has fallen by 80 hours since 1991.

Quality of life continues to improve in Zurich

In all, of the 29 metrics used by the department to measure quality of life and economic growth - such as salaries, life satisfaction and life expectancy, among others - 18 have been improving in Canton Zurich in recent years, with the biggest improvements coming in education, work-life balance, health and access to the internet. Seven of the metrics saw no change, while four criteria - road accidents, rate of unemployment and voter turnout at elections and referendums - have been worsening.

Finally, they found “the subjective life satisfaction of the people of Zurich has remained largely the same” in recent years, but is at a “very high level.” Speaking to the Tages-Anzeiger, department director Carmen Walker Späh (FDP) concluded that economic growth in Canton Zurich has increased the quality of life of all residents, not just the super-rich.

Housing crisis in Zurich remains a key issue

However, it was not all sunshine and rainbows, with the report noting that satisfaction with the “housing situation” has stagnated in recent years. Zurich has arguably been the region most affected by the ongoing housing shortage in Switzerland, which has caused rental costs for houses and apartments to shoot up. According to official data from the canton, as of June 2023 only 4.103 vacant apartments were available in the whole canton, one of the lowest vacancy rates seen since 2000.

The cost of buying a home has also risen, with real estate consultant Stefan Fahrländer noting that the average price of an apartment in Zurich has risen by 167 percent between 2000 and 2021. A November 2023 study from real estate consultant firm Iazi found that a household would have to have a salary of at least 525.000 francs a year before they could even contemplate a mortgage for a house in Stadt Zurich - along with a down payment of over 600.000 francs.

Environmental goals are a major challenge for Canton Zurich

Finally, there is the matter of the environment. Speaking to the Tages-Anzeiger, Economic Policy Department head Luc Zobrist noted that while Canton Zurich’s economy has grown by 69 percent since 1990, greenhouse gas emissions have fallen by 9 percent. "Zurich's economy has grown qualitatively without the environment being additionally affected," he noted, though conceded that “achieving the Paris climate target remains a major challenge” despite the decoupling.

When it comes to meeting Switzerland’s climate goals and maintaining living standards for residents, Zurich is between a rock and a hard place. The report found that if the canton were not to grow economically between now and 2050, while environmental quality and emissions would improve, less could be spent on environmental controls, average annual household income would fall by 14.400 francs, the canton would lose 4 billion francs a year in taxes and Swiss pension providers would lose 1 billion francs in revenue.

"Structural change is [therefore] easier to implement in a growing economy," Martin Eichler from research firm Infras told the Tages-Anzeiger. For more information about the report, check out the official press release.