Data by Statec, Luxembourg’s statistics agency, shows that revenue in the hospitality sector fell by 40% in 2020, mirroring other European countries (with the notable exception of Cyprus and Malta, where revenue declined by 70%).
There was a 9% rebound in 2021, followed by a 30% increase in 2022, but 2023 numbers still remained at least a fifth below pre-pandemic levels. With rising inflation, fewer people are eating out and staff have become more expensive.
In terms of employment numbers, the partial unemployment scheme made it possible to retain a significant number of employees. Jobs were attractive in the catering industry, but look more unfavourable in drinking and eating establishments, as well as accommodation.
Last year, employment in Luxembourg grew by 2.2%, compared to +1.4% in the euro zone. Employment has accelerated in public administration, defense, education and the health sector. However, the slowdown is particularly visible in real estate and construction.
Given the trajectory of the Gross Domestic Product (GDP) over recent quarters (-1.1% over the whole year) and the poor direction of other indicators like vacancies and hours worked, the slowdown in employment is likely to occur to extend to 2024.
