Luxembourg remains the eurozone leader in the proportion of working poor. 1 in 7 employees in the Grand Duchy is at risk of poverty. Since 2017, the share of working poor in Luxembourg surged by 45%.

In his recent State of the Nation address, Prime Minister Luc Frieden emphasised the crucial link between employment and social benefits in Luxembourg. "Our social safety net is stretched around employment. We cannot dissociate the social from the economic," Frieden declared, highlighting the necessity for work to be profitable.

However, the latest Social Panorama 2024 report from the Chamber of Employees paints a troubling picture. Luxembourg remains the eurozone leader in the proportion of working poor. In 2022, 12.4% of employees aged 16 to 64 were at risk of poverty, nearly double the eurozone average of 6.7%.

The situation has worsened, according to new data from Eurostat for 2023. Now, 14.7% of Luxembourg’s workforce is at risk of poverty—nearly one in seven employees. This stark increase places Luxembourg well ahead of other European countries, including Bulgaria, where the rate is three percentage points lower.

Over the past decade, while many European countries have managed to stabilise or reduce their working poverty rates, Luxembourg's situation has deteriorated. From 2017 to 2023, the share of working poor in Luxembourg surged by 45%.

Even full-time employment does not shield many Luxembourg residents from poverty. Households with members working over 34 hours a week display poverty risk rates twice as high as the European average. For individuals under 18 in these households, the risk rate stands at 13%, compared to the eurozone average of 6%.

In its report, the Chamber of Employees laments that "our social safety net is stretched around employment" is just wishful thinking. It makes three recommendations for the government, including revaluating the minimum wage, exempting income tax up to the qualified minimum wage, and providing additional tax relief for modest incomes.

Such steps aim to improve Luxembourg's attractiveness not just for highly qualified professionals but also for essential workers in sectors like commerce, catering, construction, personal services, social action and cleaning, fields increasingly experiencing labour shortages and which often fail to provide a decent living standard, the report concludes.