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1. Main challenges to social inclusion

2. Main concepts

Main challenges to social inclusion

Luxembourg faces broader structural and global challenges (i.e. climate change, geopolitical tensions and trade conflicts, digitalisation, and rising living costs), which disproportionately affect young people and vulnerable youth. Evidence from the Youth Survey Luxembourg (YSL) illustrates how young people’s fears and concerns have shifted since 2019, reflecting wider political and societal developments in Luxembourg and across Europe. Fear of a war in Europe clearly ranks first: almost four out of five young people (79%) report being worried about this. This is followed by concerns about serious illness, increasing environmental pollution, climate change, and terrorist attacks (Residori et al., 2025, p. 51).

These concerns are closely linked to social inclusion, as they shape young people’s sense of security, stability and future prospects, all of which are essential preconditions for full participation in education, employment and social life.

The following sections address key structural factors that intensify barriers to social inclusion in Luxembourg.

Youth Unemployment and NEETs

In 2024, the youth unemployment rate (15–24 years) stood at 21.6% in Luxembourg, compared to 14.9% at European level. In contrast, the overall unemployment rate in Luxembourg was 6.4%. The country’s higher wage levels attract jobseekers from neighbouring countries, notably Germany, France and Belgium, potentially making labour market entry more difficult for young people resident in Luxembourg. In addition, methodological factors play a role: youth unemployment rates are calculated as a share of the young active population. Given the long education pathways and the high proportion of young people enrolled in tertiary education in Luxembourg, many students and trainees are not counted as economically active, which can inflate the youth unemployment rate compared to other countries.

To provide a more comprehensive picture of young people’s situation in relation to education and employment, the NEET rate offers a complementary indicator. It measures the proportion of young people who are neither in employment nor in education or training within the total youth population, thereby including all young people regardless of labour market status.

Being NEET at a given moment does not necessarily constitute a problem; what is relevant is the recurrence of this status over a young person’s trajectory or the duration spent in the NEET category. Most studies on NEETs are static and do not account for recurrence or persistence, which are essential for assessing the severity of the situation.

On the European level, Luxembourg performs comparatively well: in 2024, 11% of 15–29-year-olds in the EU-27 were classified as NEET, compared to 9.9% in Luxembourg. While this suggests a relatively lower risk of long-term labour market and social exclusion, the existence of a substantial NEET population nonetheless highlights ongoing challenges in ensuring inclusive and stable transitions from education to employment. As highlighted in the 2025 National Action Plan on Poverty (PAN), combating unemployment is closely linked to preventing poverty.

Youth Risk of Poverty

Despite Luxembourg’s high average standard of living, poverty remains a structural factor affecting social inclusion, with young people particularly exposed. A person is considered at risk of poverty if they earn less than 60% of the national median income. In 2024, 18.1% of the resident population was at risk of poverty, and children under 18 were among the most affected groups. Almost one in four children (24.1%) lived in households with a standard of living below the at-risk-of-poverty threshold, a proportion that increased slightly compared to the previous year and stands in contrast to the much lower risk observed among people aged 65 and over (9.4%). These figures highlight pronounced age-related inequalities and point to structural vulnerabilities faced by families with children, including high housing and living costs and unequal income distribution. Although income inequality indicators such as the Gini coefficient and the inter-quintile ratio have slightly decreased, disparities remain substantial, with the living standard of the most affluent 20% of the population still 4.7 times higher than that of the least affluent 20%. For young people, growing up in households at risk of poverty can limit access to education, leisure, housing and social participation, thereby increasing the risk of long-term social exclusion.

Educational inequalities

Educational inequalities reflect Luxembourg’s pronounced linguistic, cultural and socio-economic diversity. Despite overall economic prosperity, children and young people from disadvantaged socio-economic backgrounds, from families with lower levels of educational attainment, those who do not speak one of the school languages at home, and/ or who have a migration background continue to face comparatively poorer educational outcomes. This is the result of the National Education Report 2024, which brings together issues of diversity and inclusion. Importantly, such inequalities extend beyond educational achievement alone: they are also reflected in pupils’ well-being, their experience of school-related stress and their exposure to discrimination. These challenges tend to intensify in times of crisis, such as during the COVID-19 pandemic, further reinforcing existing disadvantages. 

Impact of COVID-19

The COVID-19 pandemic has had a lasting impact on the social inclusion of young people, i.e. by exacerbating existing socio-economic inequalities. Evidence shows that young people from disadvantaged households were more likely to experience negative financial effects during the pandemic: 20.2% of those with a low socio-economic status reported a deterioration in their family’s financial situation, while young people from more advantaged backgrounds more often reported positive effects (31.5%), or no impact on their family’s financial situation (Schomacker et al., 2021). This unequal distribution of pandemic-related consequences suggests that COVID-19 reproduced existing patterns of inequalities and vulnerabilities. 

School Drop-Outs

Luxembourg’s early school-leaving rate is below both the target set by the European Commission (below 9%) and the average of the euro zone. In the 2023/2024 school year, the number of early school leavers (16 to 24 years) increased to 1,884, corresponding to a drop-out rate of 8.3%, slightly higher than in the previous year but broadly stable over the past four years.

Drop-out disproportionately affects certain groups: boys continue to represent the majority of early school leavers, accounting for over 60%, and recent trends indicate a shift towards later drop-out, with an increasing share of young people leaving education at the age of 18. The reasons leading to school drop-out are diverse and often interconnected, combining structural and individual factors. Frequently cited motivations include the pursuit of a new educational or professional project, difficulties in securing an apprenticeship placement in vocational training, but also the lack of motivation or interest in schooling and health-related issues.

Children with a Migration Background/ Experiences of Displacement

Luxembourg stands out as a “superdiverse immigration society” (Boesen et al., 2023, p. 3). Non-nationals account for approximately 47.2% of the total population. Cultural and linguistic diversity represents both a social resource and a challenge. National research shows that migration background continues to shape opportunities and inequalities, particularly in relation to formal education (Lenz et al., 2024) and access to digital media and technologies (Schumacher et al., 2025). These factors can intersect with socio-economic disadvantage, increasing the risk of cumulative exclusion among some groups of children and young people.

Access to Housing

Access to adequate and affordable housing remains a major challenge, particularly for young people seeking to transition to independent living. A severe housing shortage, a slowdown in new construction, and persistently high housing prices and rents significantly limit young people’s residential choices. As a result, many young people remain in the parental home for longer, rely on shared housing, or consider relocating outside Luxembourg. Access to homeownership among young adults is strongly influenced by family resources and migration background, with ownership rates being particularly higher among young Luxembourgish nationals with parents born in Luxembourg than among young people of non-EU nationality whose parents were born abroad. These structural constraints on housing access can delay transitions to adulthood and restrict participation in social and economic life. The salience of housing as an inclusion issue is also reflected in the 2024 EU Youth Eurobarometer, in which a notably higher proportion of young people in Luxembourg identified housing construction as a key political priority compared to the EU average (LU 31 %, EU 23 %). 

Main concepts

In Luxembourg, social inclusion is part of national solidarity and social protection, ensuring that people at risk of poverty or exclusion have access to the resources, services, and rights that are needed to live in dignity. It guarantees support to help residents participate fully in economic and social life (IGSS., Social Inclusion (in French), 2026).