The findings published by Liser in March were already cause for concern. Around 30% of foreign workers leave Luxembourg within a year of arriving, and half within five years. In an economy where over 90% of new entrants to the labour market were born abroad, this growing reliance on a highly mobile international workforce poses a structural risk.
Luxtalent’s final report, published on Monday 15 June, sheds new light on the matter, however. Looking beyond migration flows, the researchers focused on the motivations and intentions of new arrivals. And the main risk factor identified is neither salary, nor taxation, nor even career prospects. It is housing.
According to a survey of more than 3,200 new residents who arrived in Luxembourg in 2023, 65.8% of respondents cited the cost of housing as the main factor likely to prompt them to leave the country. Far behind are separation from family and professional opportunities abroad. The issue now appears to be the main retention challenge for the Grand Duchy.
More than a third in the financial sector
This finding is all the more striking given that Luxembourg continues to attract highly skilled professionals. Nearly 80% of the new arrivals surveyed hold a university degree. Three-quarters are aged between 25 and 44. More than a third work in finance, professional services or information technology. The country is clearly attracting the skills its economy needs.
The study also shows that international competition is intensifying. Nearly half of new arrivals had considered another destination before choosing Luxembourg. For the most sought-after profiles, particularly in finance and technology, the identified competitors are Switzerland, Germany and the Netherlands. The Grand Duchy’s appeal can therefore no longer be taken for granted.
The report also highlights a significant shift in migration patterns. The proportion of non-European nationals among new arrivals continues to rise and now accounts for nearly 40% of immigrants entering the labour market. Whilst this diversification is an asset to the economy, it also reveals certain vulnerabilities.
Non-Europeans are more concerned
In particular, the researchers highlight a paradox concerning non-European workers. These workers report being less satisfied with their professional situation and more concerned about their career prospects than their European counterparts. Yet they appear less inclined to leave the country. Liser puts forward a cautious hypothesis: this loyalty could be linked to administrative constraints, the recognition of qualifications or residence conditions rather than any intrinsic appeal of Luxembourg. A situation that could change rapidly if other countries were to relax their immigration policies.
Another notable finding is that the historical patterns of certain communities are changing. In particular, researchers have observed that new Portuguese workers are increasingly settling in border regions rather than in Luxembourg itself. This is a further indication of the difficulties in accessing housing and the high cost of living in the Grand Duchy.
However, it is not all bad news. Despite the difficulties identified, nearly 62% of new arrivals say they want to stay longer than they had originally planned. Luxembourg therefore retains a strong capacity to attract and integrate people. Job security, the development of a social network and settling permanently in the country play a decisive role in this trend.
