Labour market

Unemployment rate at 5.2%, jobseeker registrations surpass 16,000

Data from Statec shows that the number of registered jobseekers has surpassed 16,000 in July 2023, a figure last seen in December 2021. Archive photo: Romain Gamba / Maison Moderne

Data from Statec shows that the number of registered jobseekers has surpassed 16,000 in July 2023, a figure last seen in December 2021. Archive photo: Romain Gamba / Maison Moderne

The unemployment rate for July held steady at 5.2%, same as in June. However, Adem’s latest report highlighted a surge in new jobseeker registrations coupled with a significant drop in reported job vacancies across different sectors.

On Monday 21 August, Adem, the national jobs agency, indicated a striking uptick in jobseeker registrations within the grand duchy. Meanwhile, the unemployment rate has remained consistent at 5.2%.

Data from Statec, Luxembourg’s statistics bureau, indicated a slight increase in the unadjusted unemployment rate from 5% the previous month.

As of 31 July, Adem registered 16,111 jobseekers, a significant increase of 13%, equating to an additional 1,852 individuals compared to the same time last year.

What is particularly noteworthy is that every category of jobseekers has seen an uptick, except for those registered for more than 12 months. The younger generation, those under 30, and the highly qualified--specifically, graduates of higher education--have been hit the hardest.

A significant portion of this increase can be attributed to new registrations. July 2023 saw 2,549 new jobseeker sign-ups--an increase of 13.2% from the previous year. Among these, 86 were registrations from beneficiaries of temporary protection, specifically refugees fleeing the turmoil in Ukraine.

Alongside the growing number of jobseekers, statistics reveal a corresponding 21.1% increase in those claiming unemployment benefits, with a total of 8,515 residents. The number of participants in employment measures receded slightly, showing a 3.5% drop, amounting to 4,074--a decrease of 147 individuals compared to last year.

While the number of jobseekers rises, the demand side of the labour market appears to be retracting.

Employers reported 3,289 vacancies to Adem in July, marking a 17% drop compared to the same period in 2022. A closer look at the numbers reveals that this decline is not confined to a few sectors but is widespread. Sectors like hospitality, information, finance, and administrative support, where 42% of temporary contracts are in construction, were most affected.

By the end of July 2023, 9,513 positions were available, marking a 27% yearly decrease.

In parallel with this trend, the national territory saw a reduction of 371 full-time equivalent jobs in seasonally adjusted terms.

In raw numbers, the employment decrease amounts to 3,174 jobs, marking the most significant dip since July 2021.

This downturn, the first in nearly three years since the outset of the covid pandemic, emphasises the challenging economic climate and a tightening job market.