Luxembourg has the highest poverty rate in North-Western Europe despite leading the region in income levels, according to a recent French government study.

A recent study from France highlights a stark contrast in Luxembourg's social landscape: despite having the highest disposable income in Europe, the country also contends with one of the continent's highest poverty rates.

The report, published on Wednesday by the Directorate for Research, Studies, Evaluation and Statistics (DREES), places Luxembourg's poverty rate at 18% – the highest among North-Western European nations. This is despite a disposable income of €2,500 per month at purchasing power parity, a metric that adjusts for price differences between countries.

The study identifies specific demographic groups that are disproportionately affected. For instance, 40% of large families in Luxembourg are classified as poor, a rate nearly double that of neighbouring France and Germany. Similarly, 42% of single-parent families live in poverty.

A particularly striking finding is the profile of those considered poor. Half are in employment, a proportion that marks Luxembourg as the worst performer in Europe on this metric.

The report does note one area of relative success: pensioner poverty. Thanks to pensions that remain high relative to pre-retirement earnings, only 10% of retirees in Luxembourg are poor, indicating that the system is effectively protecting this group.