Report details Luxembourg's salary pull for French cross-border workers

A new report confirms the significant financial incentive for working in Luxembourg, revealing that cross-border workers from France's Grand Est region earn an average of 65% more than their counterparts employed locally.

According to data from France's National Institute of Statistics and Economic Studies (INSEE), the salary advantage for working in the Grand Duchy is substantial, with average pay ratios ranging from 1.25 to 2.04 depending on the specific context. Near the border, cross-border workers can earn up to twice as much as their neighbours who work in France.

INSEE attributes this disparity to several key factors: higher pay for equivalent roles, a greater concentration of high-skilled jobs in Luxembourg, and a higher average educational level among cross-border workers themselves. Institutional differences, such as minimum wage levels and business frameworks, also contribute to the gap.

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Significant pay gaps across sectors

The data reveals stark contrasts across professions. Employees in the manufacturing industry receive on average 40% more, those in the finance sector (excluding insurance) 94% more, and those in health and social care 103% more.

The advantage is also pronounced for individuals. A cross-border manager aged 40–49 with a master's degree earns €90,540 annually in Luxembourg, compared to €51,220 for a similar role in France – a 77% increase.

Perhaps the most striking finding concerns the finance sector's effect on mid-level qualifications. A cross-border employee in finance with only a secondary education earns an average of €60,670 per year. This is 2.14 times more than their French-based counterparts (€28,390) and, notably, exceeds the salary of a non-cross-border manager in France who holds a master's degree.

This reversal of traditional salary hierarchies underscores Luxembourg's powerful draw. It is now the workplace for 36% of employees residing in the Nord-Lorrain region.

© JEAN-CHRISTOPHE VERHAEGEN / AFP

Sustained appeal

This substantial pay advantage continues to fuel a dynamic increase in cross-border employment. According to INSEE's sources, the number of cross-border workers travelling to Luxembourg grew by between 7.4% and 8.6% annually over the 2018–2020 period.

This growth is characterised by high turnover. Each year, approximately 20% of the cross-border workforce is comprised of new entrants. In 2020 alone, 17,800 new commuters joined the 86,100 residents of Moselle and Meurthe-et-Moselle already working in Luxembourg. A significant shift in the local labour market is evident, with three-quarters of these new cross-border workers having been employed in France the previous year.

In the short term, this attractiveness is expected to continue. Growth forecasts for Luxembourg, which project the potential creation of 70,000 jobs by 2026, suggest the flow of cross-border workers will remain strong, provided the pay gap and demand for specific skills remain favourable to workers from Lorraine.

In summary, the powerful combination of a significant salary advantage – sometimes nearing double the pay – along with factors of qualification and geographic proximity, is durably reshaping the labour market in the French border regions of the Grand Est.