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Labour productivity in Luxembourg has stagnated for several years, and a number of structural factors become more pronounced during the summer period, notably absenteeism and reduced effective working time.
Luxembourg's legal framework offers companies several tools for organising this quieter period, such as the Work Organisation Plan (POT) or flexible scheduling.
Faced with this recurring slowdown, more and more companies are adapting their HR practices, through summer hours, increased remote work and preparation for the return to full activity in the autumn.
According to the 2023-2024 report from the National Productivity Council, labour productivity in Luxembourg has shown almost no growth for more than a decade, despite GDP per hour worked being among the highest in Europe, at 128.8 dollars in purchasing power parity in 2023.
This stagnation is partly explained by a decline in average working time per employee, driven by rising part-time work, the extension of statutory leave, and absenteeism, which accounted for 4.5% of hours worked that year. All of these factors naturally intensify during summer, a period when staffing levels are typically reduced.
The summer period actually combines several factors that weigh on the activity of Luxembourg companies. Statutory leave, set at 26 days a year, is naturally concentrated in July and August, while the number of staff present on site drops mechanically, which slows down certain projects and lengthens processing times.
Added to this is absenteeism, which is sometimes more pronounced during this period, a subject regularly debated among social partners in Luxembourg. The Chambre des salariés has for instance pointed out that working conditions have deteriorated over the past decade in the Grand Duchy, an observation that regularly fuels the debate on managing absences and workload throughout the year, including during the quietest months.
This slowdown is not unique to Luxembourg, however. It affects European economies more broadly, all of which experience strong seasonality in leave patterns, but it takes on a particular dimension in a cross-border labour market, where coordinating teams spread across several countries can become even more complex during holiday periods.
Faced with this predictable slowdown, Luxembourg labour law offers several organisational levers. The Work Organisation Plan, or POT, allows employers to set working hours based on the company's expected activity, over a reference period of one to four months, according to Guichet.lu. This mechanism is particularly well suited to summer, when activity varies significantly by sector.
Flexible scheduling is another widely used tool, allowing working hours to be adjusted between employer and employee within legal limits. Many Luxembourg companies use it in summer to offer their teams greater flexibility while maintaining continuity of service.
Remote work, governed by the interprofessional agreement of 20 October 2020, is also playing a growing role. Some companies are also experimenting with the four-day week, an arrangement that is neither required nor prohibited under Luxembourg law, and early feedback points to productivity gains, but also increased fatigue by the end of the day, according to ABAC Interim.
In this context, more and more HR departments in Luxembourg are planning ahead for summer rather than simply enduring it. This involves more rigorous advance planning of leave, to avoid last-minute tension within reduced teams, as well as a clearer distribution of responsibilities during absences.
Some companies are also introducing lighter summer schedules, particularly on Friday afternoons, a practice that remains informal in Luxembourg but is gradually spreading in certain tertiary sectors, particularly business services and finance.
Finally, the summer period is increasingly being used by HR teams to prepare for the September return, whether by finalising ongoing recruitment processes or organising the integration of new hires ahead of the full resumption of activity in autumn.
The summer slowdown in productivity in Luxembourg is nothing exceptional, but it is better anticipated than simply observed after the fact. The legal tools already exist, from the Work Organisation Plan to flexible scheduling and remote work, allowing companies to maintain activity while respecting employees' need for rest.
In a Luxembourg labour market already marked by structural stagnation in productivity, summer acts as a revealer of existing organisational tensions. Companies that manage to turn this quieter period into a time of preparation, rather than a slowdown simply endured, generally gain an advantage when activity resumes in September.
