Luxtoday
Banking and finance

Salaries in Luxembourg

Let's break down what one can earn in 2024. We'll look at minimum wages for skilled and unskilled workers, see what most people make, and what affects your pay depending on your job.

Last time updated
14.06.24

Luxembourg is famous for its solid economy, high living standard and one of the highest salaries in Europe one can get. In terms of material living conditions and financial satisfaction, Luxembourg is outperforming the whole European Union! While the average index in Europe is 6.5, the Grand Duchy's index stands at 6.9.

How high is the Luxembourg average salary

The country consistently ranks high when it comes to average salaries worldwide, and 2024 is no exception. But before you start packing your bags, it's important to understand the specifics. We will take a look at the statistics on European salaries provided by Paylab, to take a look at the latest available data.

Average monthly gross salary in Switzerland
7,247 euros
Average monthly gross salary in Luxembourg
5,144 euros
Average monthly gross salary in France
3,610 euros

However, it is just as important to consider the data on the median salary in Luxembourg as well. In this regard, the Grand Duchy is also peerless.

According to Eurostat, Luxembourgers are one of the richest people in the European Union. The median income in the Grand Duchy is 42,482 euros per year or 3,540 euros per month (all net). This is almost twice as much as the EU average salary — 18,372 euros per year (1,531 euros per month).

Glossary

It is important to distinguish several financial terms when talking about salaries and incomes. Gross and net indicates the salary before deductions (such as taxes) and after the necessary deductions are made.

The median wage is an indicator that splits the total number of jobs into two equal parts: 50% are paid below the figure and 50% are paid above it. While the average wage is the arithmetical value of the earnings of a certain group of the working population.

This way, the median figure is considered to be more representative than the average wage, and net is more realistic than gross. Especially when income taxes in Luxembourg are pretty high too.

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What is the minimum salary in Luxembourg

Luxembourg also has one of the highest minimum wages in Europe. In 2024, the minimum wage in Luxembourg depends on your age and experience. For adults, unskilled workers get at least 2,570.94 euros per month, while skilled workers earn 3,085.11 euros or more. Teenagers get a bit less — 75-80% of the wage for unskilled worker. This is the minimum employers can legally pay, but they are free to offer more.

2,571 euros
the average gross minimum wage per month in Luxembourg
30,852 euros
the average gross minimum wage per year in Luxembourg
European wage gap

The minimum wages across the European Union range dramatically, with Bulgaria offering the lowest at 477 euros per month and Luxembourg boasting the highest figure. This spread highlights the significant disparity in minimum wage levels across Europe. In fact, nearly two-thirds of EU countries fall below the 1,000 euros per month mark for minimum wage.

To compare the minimum wages here are some numbers across EU
2,054 euros
monthly gross minimum social wage in Germany
1,767 euros
monthly gross minimum social wage in France
978 euros
monthly gross minimum social wage in Poland
820 euros
monthly gross minimum social wage in Estonia

Luxembourg automatically adjusts wages, the process is called salary indexation, to match inflation. It happens when the cost of living rises enough to require higher salaries. Typically indexation in Luxembourg is held twice a year, but in 2023 with extremely high inflation, it happened three times.

There are two major groups of employees who receive the minimum wage in Luxembourg. According to the General Inspectorate of Social Security (IGSS), some 67,000 people are receiving a minimal wage in Luxembourg. In general, there are 16% more men receiving minimum wage, than women.

The unskilled workers between 20-24 years old

This group accounts for 20% of all workers receiving the minimum wage in Luxembourg. The reason for this is the lack of experience and because at this age, typically, it's just the beginning of one's career.

Skilled workers between the ages of 25-29 years old

There are 17% of minimum wage workers of this type in the Grand Duchy. This figure may seem more worrisome than the previous one, due to the overall economic recession.
Minimum salary in Luxembourg is calculated by the age and experience

Here is what you need to know about these calculations.

  • The 15 to 17-year-olds have the lowest minimum wage in Luxembourg. It stands at 1,928.20 per month.
  • For teenagers from 17 to 18 years old, the payment is slightly higher, at 2,056.74 euros per month.
  • After reaching the age of 18, now adults can qualify for a minimum of 3,085.11 euros per month.
Minimum salary rates per hour in 2024
For qualified employees19,28 euro/hour
For unqualified employees16 euro/hour
For adults 16 euro/hour
For teenagers 17-18 years old12,85 euro/hour
For teenagers 15-17 years old12,05 euros/hour

With a standard 40-hour work week, the minimum hourly salary in Luxembourg can be calculated approximately with this data.

What affects the amount of salary in Luxembourg

In 2024, several key factors come into play, from the booming tech scene to your area of expertise. This section breaks down the nitty-gritty of what shapes salaries in Luxembourg, giving you the inside track on maximising your earning potential.

Industry

Workers in the IT, financial, insurance, education, and healthcare sectors tend to earn higher wages than those in other industries. Luxembourg has its own list of professions in demand, updated regularly.

Profession

An elementary school teacher in Luxembourg earns about 68,000 euros per year. A secondary school teacher in the first year of work receives 77,000 euros on average. This difference is shown in the approach and scope of work one will face even inside one sector.

Qualification and experience

Skilled employees and ones who have a lot of working experience can be offered more competitive wages. For example, even elementary school teachers can earn about 100,000 euros annually. But this requires 15 years of experience and training. Well-qualified specialists earn more than unskilled workers in almost any industry.

Age

Teenagers are paid at different rates than adult employees, especially ones with experience. Usually, teenagers get 75-80% of what unskilled worker earns. They are also protected with special work agreement and limited in terms of how many hours one can work.
Equal pay

In Luxembourg, fairness is important: the employee's gender and type of contract are supposed to not affect the wage at all. The law ensures equal pay for equal work, regardless of these factors. Additionally, wages are automatically adjusted (salary indexation) to match inflation, typically twice a year.

  • In Luxembourg, gender equality is established by law, employers are obliged to pay the same wage in Luxembourg, regardless of the employee's race, background and gender.
  • Fixed-term workers are also entitled to the same salary as those with a permanent contract.

Luxembourg's unique workforce composition plays a significant role in salary determination. A high percentage of cross-border workers, primarily from neighbouring countries, influences wage dynamics and creates a competitive environment, particularly for in-demand skills, as well as some aspirations and the past achievement of this nation come to play role. These are the three factors that determine the labor market in Luxembourg nowadays.

The ambition to become the Silicon Valley of Europe

This explains the great attention to the IT sector and the high salaries of those in it, as well as the comprehensive support for innovative start-ups, which are also closely linked to IT.

Fintech emphasis

Luxembourg's financial services sector is leading in the country: it generates up to 26% of  GDP. Nearly every third of Luxembourg employees work either directly in the financial sector or in a related industry. That's why banking professionals and experts in insurance, consulting, auditing, and legal services are constantly in demand and well-remunerated in this sector.

Cross-border workers

These are employees who live in neighbouring countries, but come to work in Luxembourg. They create a special outline of the labor market because they want to make sure that the time spent on travel is not in vain and that this inconvenience would be compensated with the level of salaries in Luxembourg.

What are the qualified workers' salaries

As mentioned before, high-skilled workers in Luxembourg tend to receive better salaries. To give you an example, let's take a look at a few professions and their average salaries for skilled workers.

IT specialist
Healthcare
Teachers
Public sector employees
Highly qualified workers

What are the unqualified workers' salaries

Across Luxembourg labour market, salaries for unskilled workers show a clear connection to the type of job. Positions requiring less physical exertion or specific skills, like gardeners or housekeepers, tend to have lower average  wages. These roles often start around 1,913 euros per month.

On the other hand, jobs with higher physical demands or potential risks, such as lorry drivers or certain social care positions, can see salaries approaching 3,028 euros monthly. This variation highlights how even within the category of unskilled work, differences in responsibilities and working conditions are reflected in compensation.

Hospitality and construction sectors are constantly in need of employees; the demand for labor in other areas is not going down either.

Now let's take a look at several professions and their average salaries for unskilled workers in Luxembourg.

Commerce

Shop assistants earn from 1,600 to 4,933 euros average, according to the Paylab data, while cashiers minimum gross salary stands at around 1,600 euros. The gross salary range for commercial sector in general amounts to 2,579 euros (minimum salary) to 7,629 euros (highest average) with bonuses and benefits.

Cleaning

The minimal gross monthly salary for cleaner in Luxembourg stands at 1,727 euros, according to the Paylab data for 2024. The number of employees in the general cleaning sector is 2.3% of the total number of employees. This indicator ranks 4th in the whole EU. With many offices Luxembourg employs more cleaners than most EU countries — 3.1% in 2020.

Service

The most broad category of industries has the most variable salaries: it is easy to explain as many of the specialists here get more money as they gain experience and clientele. For example, hairdressers can start with salaries around 1,880 euros and grow to earn more than 4,000 euros. Gardeners will earn from 1,913 euros, plumbers can count on 2,231 euros per month. More about HORECA sector salaries in our dedicated article.
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Who and how regulates salaries in Luxembourg

In Luxembourg, salaries are regulated by the government by means of laws, collective agreements, the Ministry of Labor, and the employers themselves.

Government

The government sets the minimum salary for skilled and unskilled workers through law. Likewise, the state regulates the wage by means of taxes and social security contributions. In Luxembourg, both employees and employers contribute to the social security system, covering medical care, pension contributions, and other benefits. Luxembourg's tax system is a progressive one, meaning that those with higher incomes pay a higher percentage of their income in taxes.

Collective agreements

In industries where regular work overtime happens and non-standard working conditions apply, collective agreements play the role of regulator. Such collective bargaining agreements, usually put together by the trade union, employers, and employees of a specific given sector, are created to establish working conditions, social support measures, vacation time, and many other details. Collective agreements set minimum salaries in Luxembourg — the minimal amount of payment for the job, which can not be lower that the minimum wage set by the state.

Ministry of Labor

All extra working hours must be paid: like in many other countries, working hours in Luxembourg are limited to 40 hours per week. This rule applies to all employees without exception but still often excludes directors, managers, or self-employed people. If an employee is required to work at weekends, a permit from the Ministry of Labor must be obtained to do so. Weekend work is paid at double the normal wage and is only possible with the employee's consent.

Employer

Depending on the employer's choice, employees may be given a 13th salary or year-end bonus. Of course, there are also many bonuses for workers, that are considered to be benefits and allowances. We have covered them in our article.

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faq

Frequently Asked Questions (FAQ)

How much money can I make in Luxembourg?

Who has the best chance to find a job in Luxembourg?

Is there paid overtime in Luxembourg?

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We took photos from these sources: Yuri Shirota for Unsplash

Authors: Daria, Maria
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