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Salaries in Luxembourg

The salaries of skilled and unskilled workers in the Grand Duchy are discussed in this article.

Daria Saltykova
Author
Daria Saltykova
Maria Ovseytseva
Author
Maria Ovseytseva
Last time updated
24.02.24

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

How high is the Luxembourg average salary

The average salary in Luxembourg is 
€48,220 per year
In Europe the usual average wage is
€33,500 per year
The average salary in Luxembourg is 
€4,018 per month
In Europe the usual average wage is
€2,791 per month

In terms of amount, Luxembourg's average salary ranks first among European countries (According to Eurostat).

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

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

Neighboring countries are quite close to the Grand Duchy salaries: in Belgium, the average salary net is 2,155 euros, in Germany — 2,085 euros, and in France — 1,890 euros.

These 2 indicators — the median and the average wage, — should not be mistaken.

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.

The median figure is considered to be more representative than the average wage.

What is the minimum salary in Luxembourg

Luxembourg also has one of the highest minimum wages in Europe: as of February 1, 2023, the minimum wage in Luxembourg is 2,570.93 euros for unskilled workers and 3,085.11 euros for skilled workers.

In April 2023 another indexation of salaries is expected. This means that the minimum wage in Luxembourg will increase again.

According to the General Inspectorate of Social Security (IGSS), some 67,000 people are currently receiving a minimal wage, in other words, the Luxembourg minimum salary. In general, there are 16% more men receiving minimum wage, than women.

Likewise, there are two major groups of employees who receive the minimum wage in Luxembourg:

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.

For teenagers, the government has set the minimum salary rates.

Salary is calculated by age:

  • The 15 to 17-year-olds have the lowest minimum wage in Luxembourg: 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
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 as follows.

What affects the amount of salary in Luxembourg

It should be mentioned that salaries can vary greatly depending on:

Industry

Workers in the IT, financial, insurance, education, and healthcare sectors tend to earn higher wages than those in other industries.

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.

Qualification and experience

Skilled elementary school teachers 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.

The employee's sex and type of contract are supposed to not affect the wage at all:

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

There are also three factors that determine the labor market in Luxembourg:

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 neighboring 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 specialties and their average salaries for skilled workers.

IT specialist
Doctors
Teachers
Public sector employees
Blue Card Specialist

What are the unqualified workers' salaries

According to IGSS, the lowest-paying areas where mostly unskilled workers are employed are:

  • Automobiles trading and repair;
  • Hospitality sector – hotels, restaurants, and catering;
  • Human health and social action;
  • Construction sector;
  • Transport and warehousing.

At the same time, the HORECA and construction sectors are constantly in need of employees; the demand for labor in other areas is not going down either.

For example, let's take a look at several professions and their average salaries for unskilled specialists.

Sales associates

According to Payscale, the average salary of a Retail Sales Associate in Luxembourg is about 30,000 euros a year. This is significantly lower than the salaries of skilled workers.

Janitors

According to Glassdoor, the average cleaner in Luxembourg earns about 20,000 euros a year. It is one of the lowest wages in the Grand Duchy.

Waiters

According to Payscale, the average waiter's salary in Luxembourg is about 30,000 euros per year. This is another job with rather low salaries, although the profession itself is in high demand.

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.

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

We took photos from these sources: Yuri Shirota for Unsplash

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