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A recent report by STATEC found that, in 2023, the share of households residing in Luxembourg and having had difficulty making ends meet increased slightly (22.4% compared to 20.7% in 2022), resulting in greater economic pressure on some individuals.

People of Portuguese nationality, households who rented and single-parent families were the most affected, as more than three times out of ten, they reported having difficulty making ends meet. Between 2022 and 2023, residents of French nationality, owners with an outstanding loan and single-parent families saw their situation deteriorate the most. However, these difficulties hide significant disparities.

This STATEC report focused on the ability of households to make ends meet, or their ability to pay their current expenses, such as rent, loan repayments or energy bills, in terms of their financial resources. It is based on the first results of the 2023 survey on household income and living conditions (EU-SILC).

In 2023, 22.4% of households reported having difficulty making ends meet, compared to 20.7% in 2022.

The ability to make ends meet presents a rather subjective character of the household's perception of their ability to meet regular expenses. Therefore, STATEC noted it was important to validate this subjective perception by comparing it with more objective monetary and non-monetary indicators.

26% of households who reported having difficulty making ends meet were able to cope with an unexpected expense, compared to 92% of households who did not report difficulties. The same goes for taking one week of vacation per year away from home, which is not financially possible for 37% of households in difficulty, compared to only 3% of households without difficulty. As for the weight of non-real estate loans (for example, loans for the purchase of a car or to go on vacation) in the household budget, it was considered “heavy” by a third of households in difficulty, compared to only 14% of households who could easily make ends meet.

In addition, STATEC observed a worsening of economic difficulties between 2022 and 2023 among households who reported a difficulty making ends meet. In this category, the share of households able to face an unexpected expense fell from 37% to 26% between 2022 and 2023; that of households who could not go on vacation increased from 31% to 37%, while the share of households who could not eat meat, fish (or any vegetarian equivalent) increased from 8% to 12% between 2022 and 2023.

Young people and residents of Portuguese nationality are more exposed to financial difficulties

Young people were found to be the most affected by financial difficulties. Nearly three in ten of those aged sixteen to 25 indicated an inability to make ends meet in 2023, while the oldest were the least affected, with a percentage of 9% among people aged 65 and over. The difference is therefore clear between the generations, STATEC stressed. In addition, the situation has deteriorated most significantly in 2023 for the youngest, going from 25 to 29% of people in financial difficulty among sixteen to 25 year olds. Conversely, among those aged 65 and over, this share fell from 10% in 2022 to less than 9% in 2023.

Among the citizens of the main nationalities present in Luxembourg, residents of Portuguese nationality were the most affected by the difficulties in meeting their current expenses. In 2023, 42% of them said they will have difficulty making ends meet, a figure up four points compared to 2022. In comparison, people of Luxembourgish nationality were half as likely to say they were in difficulty. Residents of French nationality saw their condition deteriorate the most; 24% of them noted that they would have difficulties in 2023 compared to 18% in 2022.

Rent and housing loan repayments remain a very heavy financial burden for households

Owners who do not have a loan to repay for the acquisition of their home are the least affected by financial difficulties, the share having also declined between 2022 and 2023. Only 7.4% in 2023 declared being unable to make ends meet compared to 10% in 2022. At the same time, homeowners who had a loan to repay as well as tenants faced higher housing expenses and therefore more frequently reported having difficulty making ends meet. These indebted homeowners are now more than one in four having difficulties, up six points compared to 2022. Tenants are 33% in this situation.

Single-parent families, although representing only 6% of families living in Luxembourg, were in a more delicate situation than others, STATEC highlighted. They have also suffered the greatest deterioration in their financial capacities. 37% of them had difficulty making ends meet in 2023. Note that households with children were the weighted average between single-parent households and couples with children (26%). In 2023, households with children (single-parent families and couples with children) had the most difficulty making ends meet and they noted the greatest deterioration in their financial capacities between 2022 and 2023.

On the other hand, couples without children were faring the best, since only 12% of them reported being in financial difficulty, both in 2022 and in 2023.