Are you one of Luxembourg's middle class earners?

But according to a recent publication issued by the Chamber of Employees, in reality the middle class in Luxembourg is much smaller. The fact that this number has been decreasing for the past 40 years is also not a good sign for the country’s social cohesion.

Improof, a think tank within the Chamber of Employees, wanted to know the exact definition of 'middle class' in Luxembourg. In sociological and philosophical terms, this group is one of the foundations of our society, but at the same time it is a group that may disappear in the future.

For now, its existence is rather economical, says Dylan Theis of the Chamber of Employees. Improof's definition is based on financial calculations of those who earn more and less than the median income, instead of purely basing it on population numbers. Thus, Improof can better analyse the evolution of that middle class and measure its growth throughout the years.

Between €37,000 and €100,000 income per year for a single person

In Luxembourg, in 2019, the net median revenue was 41,192 euros per year. For Improof, a household is considered part of the middle class if it has an income between 75 and 200% of that net median revenue. So, for a single person this ranges from €37,772 to €100,724, and for a couple with three children the range is of €90,652 to €241,739.

In conclusion, in 2019, in Luxembourg 61.4% of households were part of the middle class. 29.5% were in the upper class and 9.1% were part of the lower class.

In 1985 however almost 71% of households were part of the middle class in Luxembourg.

For Theis this downward trending evolution is problematic. "A strong middle class is very important to a country's social cohesion. It is important that all the economical actors in the country realise that they are a part of the economical growth they see every day. This is not an irrelevant phenomenon that only represented in numbers, but that this is a reality. This decrease of the middle class is truly tragic."

To curb this tendency, tax rates and social transfers would need to be adjusted. The lower social class and the middle class would need to pay less in tax, while the richest 9% would need to pay more taxes, in order to achieve the desired rate.