Number of cross-border workers reached 212,000 in 2021

Despite a temporary slowdown in 2020, a slightly higher growth rate compared to pre-pandemic years was observed in 2021.

According to the National Institute of Statistics and Economic Studies (STATEC), the number of incoming cross-border workers to Luxembourg has steadily increased over the past six years, with an average annual growth rate of 3.8%. In 2021, the figure rose by 3.9%, as reported in STATEC's "Regards" publication released on Wednesday.

© Statec

Among the 212,288 cross-border workers employed in Luxembourg, the majority originate from France, accounting for 53% of the cross-border workforce in 2021, up from 51.7% in 2005.

The number of German cross-border workers has also increased since 2005, representing 23.7% in 2021.

Conversely, the proportion of Belgian cross-border workers has declined to 23.3% in 2021 from 2005.

Who earns the most by coming to Luxembourg?

Differences in average annual salaries, excluding employers' social security contributions, vary significantly based on the workers' country of origin.

In 2021, French cross-border workers earned an average of approximately €53,100 per year. That is €11,700 less than their Belgian counterparts and €12,000 less than their German counterparts.

© Statec

STATEC attributes this wage disparity to the concentration of French cross-border workers in sectors with lower compensation rates, such as hospitality, catering, and commerce. In addition, French cross-border workers tend to be younger on average, which may also contribute to the observed differences.

Impact on the balance of payments

Regarding the impact on the balance of payments, incoming cross-border workers' remuneration in Luxembourg for 2021 is estimated at €14.1 billion, while the remuneration received by outgoing cross-border workers amounts to €2 billion. As a result, a balance of payments deficit of €12.1 billion is projected, according to STATEC. In 2021, social contributions received exceeded social benefits paid to non-residents (excluding unemployment benefits and financial aid to students living abroad), indicating a return to normal compared to the previous year.

This trend aligns with the post-pandemic economic recovery and the restored balance in the social security system.

2020 was marked by a significant increase in social benefits paid to cross-border workers due to the partial unemployment scheme for cases of force majeure linked to the pandemic.

Number of 'outgoing' cross-border workers even lower than reported

It is worth noting that the number of incoming cross-border commuters to Luxembourg (212,288 in 2021) significantly outweighs the number of outgoing workers (13,762). However, only 1,583 individuals actually cross the border to work in France, Belgium, or Germany, as most outbound cross-border workers are employed by European or non-European international institutions.

This is a unique characteristic of Luxembourg and Belgium, where employees of European institutions are classified as "outgoing" cross-border workers because European institutions (the European Commission, the European Investment Bank, and the European Court of Justice) are not considered part of the national economy. In addition, European institutions are generally exempt from national laws and regulations.