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Where do you fall on the salary scale in Luxembourg? What is the gap between salaries in the public sector and those in the private sector? At what point can one be considered rich? RTL Infos have rounded up some tools to try to answer these questions...
What makes a "good" salary?
One that permits you to spend lavishly, or gives you the impression of being at the pinnacle of a social hierarchy? Or simply, a salary which meets your necessities?
While our readers philosophise on the matter, RTL Infos has asked the IGSS (General Inspectorate of Social Security) to provide statistical data in order to produce a "salary scale" for the Grand Duchy.
The principle is simple: salaries are classed in brackets of 10%, from the lowest to the highest. The salary that separates each of these brackets is what is called a "decile". The 5th decile, for example, corresponds to the average income because it separates the population in two, with 50% earning less and 50% earning more.
Two salary scales have been produced:one for the private sector and the other for the public sector. The scales were calculated based on basic gross salaries (excluding bonuses) from data compiled in November 2022. However, the IGSS has applied the two indexations which took place in February and April 2023 to the figures, in order to more accurately calculate the current wage distribution. The IGSS also specified that the salaries for temporary staff and cleaners in the private sector have not been included.
LUXEMBOURG'S CIVIL SERVICE - A DREAM CAREER?
With a gross average salary of €3,985 in the private sector, and €8,500 in the public sector (and €4,203 for all sectors combined), it is worth noting that Luxembourg offers the most generous salaries in Europe.
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The civil service is known for its high salaries, but it is even more impressive when comparing the salary scales. The lowest paid 10% in the public sector was capped at €5,008 gross per month , twice as much as the lowest paid 10% in the private sector (€2,588)! At the other extreme, the best paid 10% of the public sector earn at least €12,340 euros gross, compared to €8,561 minimum in the private sector. These are base gross salaries, without all bonuses and benefits.
However, it must be noted that more and more employees in Luxembourg are exposed to the risk of poverty. In 2021, the poverty line in Luxembourg (60% of the median standard of living) amounted to €2,177 net per month, per adult , meaning around 115,980 people, or a whopping 20% of the population, risked falling into poverty. So our last question is, if there is a poverty line, why do we never talk about the wealth line?
WHAT QUALIFIES AS A "RICH" SALARY?
Luxembourg holds many records relating to wealth: it has one of the highest standards of living, a record number millionaires among the population, and was even designated the richest country in the world by Global Finance magazine last year. But still questions arise - how does one define the country's wealthiest inhabitants? How many are there? And what does it mean to be rich in Luxembourg?
Some have tried to define a threshold of wealth. In France, the Inequality Observatory defined the wealth threshold for a person at €3,800 euros net in 2023. This was calculated by multiplying the average standard of living by two (taking into account all personal income, taxes and household composition).
In Luxembourg, according to Statec, the average standard of living amounted to €3,540 in 2021. If we multiply it by two, this places the wealth threshold in Luxembourg at just over €7,000 net per month, per adult.
This figure, however, must be taken with a grain of salt, as Statec refuses to calculate a wealth threshold. "Just like the poverty line, there is no single approach to calculate a wealth threshold," said the statistics office. Despite this, Statec publishes data on the poverty line annually.
It must also be remembered that factors other than income, such as housing or financial assets, family, the duration of a person's career, will all significantly affect a person's wealth and how they view themselves.
What income qualifies a person as "rich" in Luxembourg? Are you satisfied with your salary? Why not participate in our survey below, it's quick and anonymous!
