For the first time, Knight Frank has compared the total cost of employing 100 people in the world’s leading cities, based on the cost of workspace and average salaries.

The independent property consultancy found the total cost of basing 100 staff in Edinburgh sat at £2.60 million ($3.47m) compared to £3.9m ($5.23m) in London – a total difference of £1.31m ($1.76m) or 33%.

The finding makes Scotland’s capital one of Europe’s most competitive major business hubs in terms of cost, ahead of Dublin ($4.05m), Stockholm ($4m), Frankfurt ($3.81m), and Amsterdam ($3.52m).

The worldwide list is topped by Zurich, where high salary costs in the banking and asset management sectors mean companies would pay $7.95m per year to locate 100 staff in the city.

Zurich is followed by New York, and then San Francisco ($6.70m), where the cost of employing a highly-skilled tech workforce drives up total occupancy costs.

Warsaw, meanwhile, is emerging as an attractive European business location offering a well-educated, multi-lingual labour force at relatively low cost ($1.63m).

Alasdair Steele, head of Scotland commercial at Knight Frank, said: “Edinburgh continues to emerge as a truly global city – it’s becoming an increasingly popular destination for international businesses as well as a magnet for overseas investment capital.

“From a cost perspective, Scotland’s capital offers clear advantages over many of Europe’s major business hubs. Combined with its quality of life benefits, skilled workforce, and buoyant tech scene, there’s a compelling case for Edinburgh as the city grows from strength to strength.”

Lee Elliott, head of commercial research at Knight Frank, said: “Access to high-skilled talent is a well-established determinant of corporate real estate and location decision making. But in a low-growth economic environment where margin protection and cost control is paramount, the cost of both employing and accommodating this talent is becoming important too.

“Edinburgh’s costs relative to other Global Cities are compelling. This provides a clear incentive for global companies to actively consider Edinburgh, particularly those in the tech and financial services sector which need to attract and retain the best people, in state-of-the-art workspace.

“Although rival European cities do offer even lower employment and property costs, many global companies will see this as a false economy if they are unable to access the tech and creative talent they require, which Edinburgh has in great abundance.”