Despite its small size, Luxembourg plays a major role on the European stage. While 2023 saw some economic slowdown, the country continues to attract talent from around the world thanks to its political stability, open economy, dynamic and diversified job market, and advantageous working conditions. Luxembourg provides numerous opportunities, notably in sectors such as finance, insurance, information technology, logistics, and healthcare, further enhancing its international appeal.
How is Luxembourg's job market performing?
Luxembourg's job market is one of the most dynamic in the European Union. Although unemployment has slightly increased, it remains low, with a rate of just 5.7% as of June 2024.
Employment growth slowed somewhat during 2023, mainly due to fewer job creations in some areas, affecting the overall market dynamics.
However, job growth remains positive, and demand for skilled labor is high, namely in key economic sectors like finance and ICT (information and communication technology). Other sectors, such as legal and consulting services, as well as human-centered professions (psychologists, caregivers, human resources…), are also constantly seeking talent due to labor shortages.
For more information on occupations in shortage in Luxembourg, you can visit the Adem (National Employment Agency) website, which regularly updates its list.
A diverse workforce
The diversity of Luxembourg's job market is one of its most striking features. The Grand Duchy stands out for its highly varied workforce, including Luxembourgish residents, foreign residents, as well as a large number of cross-border workers from neighboring countries (France, Germany, Belgium).
As of January 1, 2024, Luxembourg's active population comprised over 515,000 workers, about 75% of whom are foreign residents and cross-border workers. This cultural and linguistic diversity is a significant asset for Luxembourgish companies, which often operate internationally and require teams capable of working in multiple languages and adapting to different cultural contexts. The country's ability to attract and integrate foreign workers is reinforced by its favorable legislation and immigration policies tailored to labor market demands.
Accessing the job market
Access to Luxembourg's job market depends on whether you are a European Union (EU) citizen or not. EU citizens enjoy relatively simple access, thanks to the free movement of workers, and they can move to and work in Luxembourg without needing a work permit – which makes integration into the labor market much easier.
For third-country nationals (non-EU nationals), however, accessing the Luxembourgish job market is more regulated. Employers must obtain a work permit for their non-European employees, a process that can take time and is subject to certain conditions. Nonetheless, Luxembourg has recently introduced reforms to simplify this process for jobs in shortage.
Employment contracts and leave
Employees enjoy strong protection and favorable working conditions under Luxembourg's well-structured labor framework. This framework ensures a balance between workers' rights and employers' needs, while keeping the job market attractive.
Two main types of work contracts are favored: permanent employee contracts (CDI) and fixed-term contracts (CDD). The CDI is the most widespread and offers long-term job security, while the CDD is used for temporary or specific tasks and cannot exceed 24 months (including renewals). Other types of contracts, such as apprenticeships (including adult apprenticeships) and student contracts, are also common and regulated by law.
Employment contracts must be made official in writing and include specific details pertaining to the job conditions such as salary, working hours, work location, and job responsibilities.
The standard working week in Luxembourg is 40 hours over five days, although some sectors may have different schedules depending on the nature of their activity. Luxembourgish law also requires a minimum daily rest of 11 consecutive hours and a weekly rest of 44 consecutive hours, ensuring a healthy work-life balance.
Employees in Luxembourg are entitled to at least 26 days of paid annual leave. Collective agreements often provide additional vacation days. There are also 11 public holidays, and if a holiday falls on a weekend, employees are compensated with an extra day off, ensuring a minimum of 37 non-working days per year.
Employees are also entitled to additional leave in certain circumstances, such as family events or health reasons. Other types of special leave are available, such as for training or learning the Luxembourgish language.
Overtime is strictly regulated, with compensation provided either in the form of rest time (1 hour of overtime = 1.5 hours of compensation) or additional pay, with a 40% increase.
Salaries in Luxembourg
Proposed salaries in Luxembourg are among the highest in Europe, though they vary depending on the sector, job position, and employee experience.
There is a minimum salary for positions that do not require specific qualifications (€2,570.93 gross in August 2024), and a higher minimum wage for qualified workers (with a diploma or 10 years of experience in a field: €3,085.11 gross in August 2024).
The minimum wage for non-qualified workers is regularly appraised, as a new index is triggered every time the cost of living rises by 2.5%. As a result, the minimum wage can evolve very quickly, so it's important to stay informed during your job search.
It is good to know that as of 2024, the median monthly salary in Luxembourg is approximately €4,843 gross. The highest-paying sector is finance and insurance (€9,418.17 gross on average), followed by education (€9,280.17 gross), public administration (€8,371.50 gross), and ICT (€6,656.75 gross). The lower-paying sectors include industry (€5,018.83 gross), construction (€4,132.25 gross), and Horesca (hospitality and restauration; €3,371.75 gross).
A system that benefits employees
Luxembourg complements its attractive salaries with many employee benefits. For instance, social security covers between 80% and 100% of medical expenses, depending on the nature of the treatment, while children benefit from 100% coverage for all medical care – including orthodontics and ophthalmology – until the age of 18. These conditions make Luxembourg's healthcare system one of the best in the world.
Luxembourg's tax system is also very favorable. Income tax is based on a progressive scale, with rates ranging from 0% to 42% for the highest incomes.
Luxembourg applies withholding tax, so employees do not need to file tax returns. However, it can be beneficial to do so, as the country offers many deductions and tax advantages.
Skill development
Luxembourg boasts a highly qualified and multilingual workforce. Approximately 60% of workers in Luxembourg are highly skilled, placing the country among the world leaders in terms of professional expertise.
To maintain and develop this high level of performance, Luxembourg has an efficient continuing education system. A wide range of affordable, high-quality training programs is available. Evening courses are particularly abundant, making it possible to start up in Luxembourg in a position that does not require specific qualifications and then train to access other types of jobs.
This adult learning policy also allows for job changes or even career shifts, sometimes within the same company, facilitating professional retraining (NO LINK FOUND TO ENGLISH VERSION).
Which sectors are recruiting the most?
When people think of Luxembourg, they often think of finance, and for good reason! This sector is the country's largest employer, with over 100 different banks. The financial sector continuously seeks skills in auditing, management, and legal services. Insurance companies are also highly present and regularly recruit. While industry plays a smaller role, it remains critical, given the numerous existing enterprises that offer opportunities for engineers and technicians. The information and communication technology (ICT) sector is rapidly growing, with strong demand for professionals in cybersecurity and software development.
Other sectors in constant need of talent include craftsmanship, hospitality and restauration (referred to as "Horesca" in Luxembourg), agriculture, healthcare (doctors, nurses, caregivers, psychiatrists, psychologists…), and human resources.
Innovation, digitalization, and transitioning to a green economy are the focal points of Luxembourg's economic plans for the coming years. The country's government is heavily investing in research and development, as well as cutting-edge technologies like eco-technologies, health technologies, and space technologies.
These initiatives are expected to create new job opportunities in emerging sectors in the coming years. Future jobs in Luxembourg will likely include positions in cybersecurity, artificial intelligence, renewable energy, and digital health.
Luxembourg is also highly attractive to entrepreneurs. Numerous institutions, such as the House of Entrepreneurship, support project leaders. Entrepreneurs in Luxembourg benefit from the same legal conditions as employees for unemployment and maternity/parental leave, among other things.
Becoming a civil servant in Luxembourg
The public sector plays a central and unique role in Luxembourg. Numerous positions are available in administration, education, and healthcare, offering excellent conditions, such as high salaries. The proper functioning of the country relies heavily on a large number of civil servants, who contribute to the stability and development of Luxembourgish society and the exceptional quality of life the country provides.
Contrary to popular belief, it is possible for foreigners to work in the Luxembourg public sector. Public jobs are open to European Union (EU) and European Economic Area (EEA) citizens, except for some positions such as those related to national security.
For third-country nationals, access to public sector jobs is more limited and subject to specific conditions, though exceptions can be made, particularly for positions requiring rare technical or linguistic skills.
To become a civil servant in Luxembourg, candidates must pass an entrance exam, usually held once a year. The exams are conducted in one of the country's three official languages (Luxembourgish, French, or German). Once the exam is passed, candidates can apply for government positions on the GovJob website. It is also possible to find similar positions to the public sector that do not require passing the exam.
Luxembourg distinguishes itself through a dynamic and diverse job market, supported by a constantly evolving economy. The country is committed to remaining at the forefront of innovation and is determined to achieve its ambitions. For professionals seeking new opportunities, Luxembourg provides a stimulating work environment, advantageous conditions, a healthy work-life balance, and a multilingual, welcoming job market. Whether you are already an expat or considering becoming one, the Grand Duchy invites you to explore the many possibilities it offers.
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