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Luxembourg vs. Switzerland: two countries with high salaries and living standards
Which is better? Which country offers higher salaries, more job opportunities, and a better quality of life? How do they compare and contrast? In this article, we will provide a comparative analysis of Luxembourg and Switzerland across multiple aspects to help shed light on these questions.
One key detail to note first is that Switzerland is part of the Schengen Area, allowing travel to the country with a visa or residence permit from any European country within this zone. However, Switzerland is not a member of the European Union. This distinction has significant implications for travel, work, and residency opportunities when comparing Luxembourg vs. Switzerland.
Luxembourg vs Switzerland: briefly about the main things
Luxembourg and Switzerland stand as two European powerhouses, each offering unique advantages to residents and visitors alike. With Luxembourg boasting the highest salaries in the European Union and Switzerland renowned for its unparalleled quality of life, the choice between these two nations can be challenging.
In the following sections, we will venture into the key factors influencing this decision, from cost of living to job opportunities, providing insights to help you make an informed choice between Luxembourg and Switzerland. We will start by exploring the territory and population of both nations.
Grand Duchy of Luxembourg
One of the world's smallest countries landlocked in northwestern Europe.
Swiss Confederation
A small landlocked country located in west-central Europe.
Population and territory
We begin our comparative analysis of Luxembourg and Switzerland by examining their size and population. Luxembourg, one of the smallest countries in Europe, covers only 2,590 square kilometers. It's so small that you can drive from its northern to southern borders in just an hour and a half. In contrast, Switzerland is significantly larger, spanning 41,290.7 square kilometers, enough to fit Luxembourg about 16 times within its borders.
2,590
square kilometers – territory of Luxembourg
41,290
square kilometers – territory of Switzerland
When it comes to population, as expected, Luxembourg is much less populated. Luxembourg has a population of approximately 660,809, whereas Switzerland had 8,815,385 inhabitants. This means Switzerland has roughly 13 times more residents than Luxembourg.
660,809
population of Luxembourg in 2023
8,815,385
population of Switzerland in 2023
It's interesting to look at the population growth of both nations. Although Switzerland saw a larger absolute increase in population — an increase of 860,723 people since 2012 compared to Luxembourg's increase of 135,956 people — Luxembourg experienced a higher relative growth. Luxembourg's population grew by 25.90%, while Switzerland's population grew by 10.82% over the same period.
Expat population
In terms of its composition, it is interesting to note that Luxembourg had a large percentage of foreign-born population on January 1, 2023, an impressive 52.57% of which the majority were of Portuguese and French nationality. Switzerland, on the other hand, had 30.20% of its population of foreign origin, a much smaller but still considerable percentage.
General vibe compared
When comparing the general vibe of Luxembourg and Switzerland, several cultural and lifestyle differences stand out, alongside some notable similarities.
Languages
Both Luxembourg and Switzerland are culturally rich and diverse, with multilingual populations. In Luxembourg, the official languages are Luxembourgish, French, and German. This trilingualism reflects its position at the crossroads of Germanic and Latin cultures. Switzerland, on the other hand, has four national languages: German, French, Italian, and Romansh. This linguistic diversity underscores the country's blend of cultural influences from its neighbouring countries, Germany, France, and Italy.
Climate
The climate in Luxembourg is temperate, characterised by mild winters and cool summers. It experiences moderate rainfall throughout the year. Switzerland's climate varies more due to its diverse topography. The Swiss Alps create distinct climatic zones; the southern region enjoys a Mediterranean climate, while the central plateau experiences a temperate climate with more significant seasonal variations. The mountainous areas receive heavy snowfall in winter, making Switzerland a prime destination for winter sports.
Lifestyle
Luxembourg offers a relaxed and family-friendly lifestyle. Its small size means that everything is conveniently close, and there is a strong emphasis on community and quality of life. The country is known for its high standard of living, excellent healthcare, and education systems. Residents enjoy a mix of urban and rural environments, with picturesque villages and modern city amenities.
Switzerland is renowned for its high standard of living and efficiency. Swiss cities like Zurich, Geneva, and Bern are known for their cleanliness, organization, and high-quality of public services. The Swiss lifestyle emphasizes punctuality, precision, and a healthy work-life balance. Switzerland also offers a range of outdoor activities, from skiing in the Alps to hiking and cycling in its beautiful countryside.
Cultural heritage and festivals
Both countries celebrate a variety of cultural festivals. Luxembourg is known for events like the Schueberfouer, a large annual fair, and National Day festivities. Switzerland hosts numerous traditional festivals such as Fasnacht (Carnival), the Montreux Jazz Festival, and the Locarno Film Festival. Both nations pride themselves on preserving their cultural heritage while embracing modern influences.
While Luxembourg and Switzerland share similarities in their high standards of living and cultural diversity, they each offer unique experiences shaped by their languages, climates, and lifestyles. Luxembourg’s intimate and community-focused atmosphere contrasts with Switzerland’s blend of urban sophistication and natural attractions, providing distinct options for those considering a move or a visit.
What are the similarities?
Diverse
Both countries boast rich cultural diversity and multilingual populations.
Social
Luxembourg and Switzerland have high standards of living and excellent public services.
Rich
Each nation hosts many festivals, celebrating their heritage and modern influences.
People-oriented
Both countries provide top-notch education and healthcare systems.
Quality and cost of life
The next two aspects we'll analyse are the quality of life and the cost of living in both countries, two extremely important elements that often go hand in hand.
Quality index
Assessing the well-being trends of European citizens is quite complex due to the subjective nature of this aspect. However, European Union statistics provide some insights. One such metric is the Global Life Satisfaction Index, where Europeans rate their life satisfaction on a scale from 0 (very dissatisfied) to 10 (very satisfied).
Source: Eurostat
According to this index, the average in Europe is 7.1 points. Luxembourg scores well with a rating of 7.2 points, slightly above the European average. Switzerland stands out significantly, leading the list with a rating of whole 8 points!
Cost of living
Now, let's examine the cost of living in Luxembourg vs Switzerland. Both countries have a high cost of living, but to understand the extent, it is useful to use reference indexes. Numbeo provides the world's largest database on the cost of living, and its data and indexes give us a clearer picture.
Numbeo offers several indexes, all based on a comparison with costs in New York City. Their most comprehensive index, the "Cost of Living Plus Rent Index," estimates consumer goods prices, including rent, in comparison to New York City.
Source: Eurostat
The "Cost of Living Plus Rent" index compares data from 260 of the most important cities in Europe, revealing that Switzerland has the highest cost of living. The top six positions are held by Swiss cities: Geneva, Zurich, Basel, Lucerne, Lausanne, and Lugano. While Luxembourg also has a high cost of living, it is significantly lower than that of Switzerland. Luxembourg City ranks at number 27.
Other interesting indexes are the Groceries Index, the Restaurant Price Index, and the Local Purchasing Power Index, in which Luxembourg is better positioned. This suggests that while both countries are expensive, the cost of everyday goods and services, as well as the purchasing power, are more favorable in Luxembourg compared to Switzerland.
Public transport in Luxembourg is completely free, learn why in our article
Read the articleEmployment and job opportunities
We have reached a crucial point: employment and work opportunities. Both Luxembourg and Switzerland offer extensive opportunities, but each excels in different areas.
Top industries
- In Luxembourg, the most developed industrial sectors include financial services, technology and communications, logistics, and transportation. Luxembourg is a global financial center and a key logistical hub in Europe, with strong investments in digital innovation and aerospace.
- Switzerland, on the other hand, stands out in financial services, the pharmaceutical and biotech industries, luxury watchmaking, technology and innovation, and precision machinery and equipment. Switzerland is known for its financial stability, advancements in healthcare and biotechnology, and excellence in engineering and high-quality products.
How to get a job in Luxembourg: application, interview, contract
Working as a foreigner
Both countries continuously attract professionals from around the world, although Switzerland, being larger, has a higher rate of labor immigration. In 2022, Switzerland welcomed 13,273 people for work purposes, while Luxembourg accepted 30,204.
Source: Eurostat
BYOB (Bring Your Own Business)
Both Luxembourg and Switzerland are ideal countries to take your business there or to start one, if you want more information on this subject we recommend a couple of sites with information on it, one for Luxembourg and one for Switzerland.
Professions in-demand in Luxembourg vs. Switzerland
The following table shows the most in-demand professions in both countries, with data sourced from Luxembourg's ADEM (Agence pour le Développement de l’Emploi) and Schengen News website.
Top demanded jobs in both countries in 2024
| 🇱🇺 Luxembourg | 🇨🇭 Switzerland |
| Analysis of loans and banking risks | Healthcare Specialist / Nurse |
| Bank customer management | Electrician |
| Office and middle management in the financial | Carpenter |
| Paving and restoration of pavements | Project Manager |
| Management and engineering industrial researchers | Software Developer |
| Production management and engineering | Polymechanic |
| Installation and maintenance of industrial equipment | Service Technician |
| Caregiver Assistant / Nurse | Logistics Specialist |
| Psychologist | Automation specialist |
Minimum wages and salaries
Luxembourg and Switzerland have unique approaches to minimum wages. In Luxembourg, there are two minimum wages: one for unskilled workers and another for skilled workers. The minimum wage for an unskilled worker aged 18 or older is 2,570.93 euros, while for a skilled worker, it is 3,085.11 euros in Luxembourg.
We have previously covered the possible salaries in Luxembourg in our article
Read article
In Switzerland, the minimum wage is not applied at the national level but rather at the cantonal level (with some cantons offering a minimum wage and others not) and through collective labor agreements (CLA) of certain companies, regardless of the canton of employment.
Canton of Neuchâtel
Minimum wage per hour is 21,09 CHF (around 22,5 euros).
Jura
Minimum wage per hour is 20,60 CHF (around 22 euros)
Ticino
Minimum wage per hour varies between 19,75 and 20,25 CHF (or 21 and 21,6 euros).
Geneva
Minimum wage per hour is 24,32 CHF (around 26 euros).
Basel-Stadt
Minimum wage per hour is 21,70 CHF (or 23,16 euros), but it varies based on sectors.
So, the minimal payment one can expect by law in both countries will be
16 to 19,28
euros per hour is the minimal wage of the worker in Luxembourg
20,6 to 24,32
euros per hour is the minimal wage of the worker in Switzerland
Taxation of the income
Addressing the topic of taxes is complex due to the many variables involved. However, a starting point to shed some light on this area is the top marginal income tax rates. Comparing both countries, Luxembourg's highest tax bracket is 45.80%, which is 6.3% higher than Switzerland's top rate of 39.50%. Nonetheless, both countries are within a medium range compared to the rest of the European Union.
Source: Eurostat
This provides an initial perspective, but many other factors must be considered. It is advisable to seek professional advice tailored to individual circumstances to get a comprehensive understanding of tax implications.
Before and after taxes
If you would like to get an idea of how much tax you would have to pay in Luxembourg, take a look at our service. We have created an income calculator, that explains a lot.
Relocation procedures and options
Relocating to a new country involves a myriad of questions and considerations. When contemplating a move to Luxembourg or Switzerland, one might wonder about the visa requirements, residency permits, and the overall process of settling into a new environment. These are the common procedures required.
Popular grounds for relocation
Studies
Many individuals relocate for educational opportunities. Luxembourg and Switzerland boast prestigious universities and research institutions, attracting students from around the globe. To study in these countries, one typically needs to secure a student visa.
Requirements usually include:
- Proof of enrolment at a recognised institution,
- Evidence of sufficient financial resources to cover tuition and living expenses,
- Valid health insurance,
- A valid passport.
Work
Relocating for employment is another prevalent reason. Both Luxembourg and Switzerland have robust job markets in various sectors. To move for work, the following are generally required.
Requirements usually include:
- A valid job offer from a company in the destination country,
- A work visa or permit, which the employer often assists in obtaining,
- Proof of qualifications and sometimes proficiency in the local language(s),
- Valid health insurance and a clean criminal record.
Work documents required
If you are interested in working in Luxembourg, we recommend our detailed article on how to obtain a work visa for Luxembourg.
A special option in this area is the European Blue Card, which is available in most European countries, including Luxembourg, but not in Switzerland. This card is intended for highly qualified workers, it offers certain advantages but also comes with special conditions for obtaining it.
Role and qualification
You need to possess an employment contract for a year or more, which assumes a highly-qualified position in the company. Of course, you will also need to proof your qualifications with certification documents.
Great salary
Offered salary must be at least 1.2 times the Luxembourg average gross annual salary (67,824 euros) for professions such as mathematicians, systems analysts, software and web designers, programmers, database specialists, and network administrators, where a particular need for third-country workers is identified by the government.And at least 1.5 times the Luxembourg average gross annual salary (84,780 euros) for all other professions.
ADEM approval
In case you are coming from a third-country, outside the Schengen area, your employer will need to get a certificate allowing them to hire you from ADEM, local employment agency. They will make sure there is a need and there are no other people who can take the job currently at the labor market. Read more in our special guide.
Family
Moving to join family members is a common motivation for relocation. Family reunification visas allow spouses, children, and sometimes extended family members to live together.
Requirements typically include:
- Proof of relationship (marriage certificate, birth certificates),
- Evidence that the family member residing in the destination country can financially support the applicant,
- Accommodation that meets local standards,
- Health insurance coverage.
How to choose where to relocate between Luxembourg and Switzerland?
Relocating to a new country is a significant decision that involves considering numerous factors, including quality of life, cost of living, employment opportunities, and personal preferences. Luxembourg and Switzerland both offer advantages and challenges.
🇱🇺 Luxembourg's best and not-so
Luxembourg boasts the highest minimum wages in Europe, providing a strong financial foundation for workers.
The country offers a vibrant, multicultural atmosphere with a large foreign-born population, making it welcoming to newcomers.
Luxembourg provides special visas, such as the European Blue Card, for highly qualified workers, facilitating easier relocation for professionals.
The low corporate tax rates make Luxembourg an attractive destination for entrepreneurs and business owners.
The country has a highly developed healthcare system, ensuring access to quality medical services.
Luxembourg offers free public transportation, making it easy and cost-effective to travel within the country.
While not as high as Switzerland, Luxembourg's cost of living is still considerably high, especially when it comes to renting prices.
The top income tax bracket in Luxembourg is significantly high, and the taxation is progressive.
The cost of housing in Luxembourg is quite steep, and it can be challenging to rent property on a budget, especially in the capital.
Obtaining a student visa requires proving substantial income, which can be difficult for foreign students. Additionally, students are limited to part-time work during their stay.
You might need to be persistent to acquire a permit and the citizenship afterwards. It requires a continuous living in the country and language skills, but not only.
🇨🇭 Switzerland's pros and cons
Switzerland ranks highest in Europe for quality of life according to the Eurostat Life Satisfaction Index.
Despite the absence of a national minimum wage, salaries in Switzerland are generally very high.
Switzerland's public transportation system is world-renowned for its efficiency and connectivity, reaching even the most remote areas.
Switzerland has the highest cost of living in Europe, impacting daily expenses significantly.
Although lower than Luxembourg's, Switzerland's top income tax rates are still quite high.
Despite high salaries, the Swiss job market can be very competitive, especially in specialised industries.
Certain regions in Switzerland experience long, cold winters, which can be challenging for those not accustomed to such climates.
Frequently Asked Questions (FAQ)
Which country has a higher cost of living, Luxembourg or Switzerland?
Luxembourg and Switzerland both have high living costs, but Switzerland typically edges out Luxembourg in terms of overall expense. Factors such as housing, transportation, and everyday goods tend to be more costly in Switzerland due to its strong economy and high standard of living. However, Luxembourg's cost of living is also significant, particularly in areas such as housing and dining out. Both countries offer excellent public services, but residents should be prepared for higher expenses compared to many other European nations.
How does the quality-of-life index compare between Luxembourg and Switzerland?
Switzerland consistently ranks among the top countries in Europe for quality of life, boasting excellent healthcare, education, safety, and infrastructure. Luxembourg also offers a high quality of life, with a strong economy, advanced healthcare system, and diverse cultural scene. While both countries provide a high standard of living, Switzerland often edges out Luxembourg slightly in quality-of-life rankings due to factors such as its stunning natural landscapes, efficient public transportation, and robust social welfare system.
What are the main industries and job opportunities in Luxembourg vs. Switzerland?
In Luxembourg, key industries include finance, technology, logistics, and aerospace, offering diverse job opportunities in banking, IT, transportation, and engineering sectors. Switzerland is known for its strong presence in finance, pharmaceuticals, luxury goods, and precision engineering, providing job prospects in the banking, healthcare, watchmaking, and manufacturing industries. Both countries offer a range of employment options, with Luxembourg excelling in finance and technology, while Switzerland boasts expertise in finance, healthcare, and engineering sectors.
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Source: ec.europa.eu, ec.europa.eu, datos.bancomundial.org, www.expatica.com, ec.europa.eu, ec.europa.eu, www.numbeo.com, adem.public.lu, schengen.news, www.ch.ch, www.travailler-en-suisse.ch, frontaliers-grandest.eu, taxfoundation.org
We took photos from these sources: Tim Trad on Unsplash
Authors: Luz
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