The labour market

The labour market

Luxembourg experienced a significant shift in its labour market in the 1980s. From an industrial economy mainly based on steel, it rose to an economy dominated by services.

The banking sector plays a major role, if not dominant.

Given the high demand of this sector for qualified labour, Luxembourg must recruit abroad, particularly in its neighbouring countries.

Today, cross-border commuters account for 41% (155,000 people) of total employees in the Grand Duchy (375,000 jobs). The labour market in Luxembourg is therefore atypical and largely dependent on an immigrant workforce. This characteristic may develop further in the future since Luxembourg is forced to maintain a very large active population in order to preserve its high social benefits.

The unemployment rate is between 5 and 7%, well below the European Union average of 10.8% (source: Eurostat, June 2014).