Workers aged 45 and over account for more than 40% of jobseekers registered with ADEM, with periods of unemployment often exceeding two years, in a country where the employment rate for those aged 55–64 remains well below the European average.
Luxembourg law provides for four specific measures to support the continued employment of older workers, including a requirement for an age management plan for companies with more than 150 employees, as well as financial support for recruitment and training.
Au-delà des obligations légales, les recherches Beyond legal obligations, LISER research shows that managerial practices promoting engagement, knowledge transfer and skills development are more effective than financial incentives alone in keeping older workers in employment.
The ageing of the workforce is a well-documented reality in Luxembourg, but its implications for HR departments are still too often treated as a compliance issue rather than a strategic lever. The labour force participation rate for those aged 55 and over has, however, risen considerably, from 45.5% in 2005 to 55.4% in 2025 according to STATEC, and in March 2025, nearly 45,000 Luxembourg residents aged over 55 were working in Luxembourg, representing approximately 15.8% of total resident employment.
However, this increase remains insufficient by European standards, and ADEM figures reveal a persistent tension between the extension of working life sought by the public authorities and the practical difficulties faced by older people in remaining in or re-entering employment.
The monthly statistics from the ADEM paint a worrying picture for older workers. As of 31 January 2026, the number of resident jobseekers registered with the ADEM stood at 21,255, up 9.4% year-on-year, with a 7.8% increase in the over-45 age group. This trend has been ongoing for several months and particularly affects highly skilled workers, indicating that the phenomenon is no longer limited to low-skilled jobs. ADEM regularly publishes a special report focusing on jobseekers aged 45 and over, which documents the structural barriers faced by this group.
Jobseekers aged 45 and over account for more than 40% of jobseekers registered with ADEM, and more than half of them have been registered for over 24 months. Furthermore, 27% of them have the status of disabled employees or those with reduced working capacity, compared with 17% for all resident jobseekers, which adds a further layer of complexity to their reintegration. These figures point to a cumulative risk: the longer unemployment persists, the greater the obstacles to reintegration become, whether due to skills becoming obsolete, the influence of age-related stereotypes in recruitment processes, or health issues.
Luxembourg ranks among the European countries with the lowest employment rate for 55–64-year-olds, with only 46.6% of this age group in employment, compared with an average of 61.3% across OECD member countries. The employers’ organisation UEL recently highlighted that this demographic in Luxembourg harbours economic, social and societal potential that remains largely untapped, and that the country’s residents retire relatively early compared to the OECD average. The issue is therefore no longer merely social: it is economic, and HR departments are directly involved.
Luxembourg law has gradually introduced a set of measures designed to encourage the retention and recruitment of older workers, which provide concrete tools for employers. Four main mechanisms form the basis of this legal framework: the ADEM recruitment subsidy for those aged 45 and over, the exemption from employer social security contributions for those aged 57 and over, the workplace adaptation grant for those aged 50 and over, and the mandatory age management plan for companies with more than 150 employees, governed by Articles L.521-1 to L.521-10 of the Labour Code.
The recruitment subsidy is the most direct incentive for recruiters. Under certain conditions, the ADEM reimburses the employer’s social security contributions paid for any unemployed person aged 45 and over hired on a permanent contract or a fixed-term contract of at least 18 months, provided that the post has been declared in advance.
The application for reimbursement must be submitted within six months of the employee’s recruitment, failing which the claim will lapse, and the role must involve at least 16 hours of work per week. For employees aged 50 and over who are already in post, financial assistance covering up to 50% of payroll costs for a maximum of 24 months and a grant of up to €20,000 for workplace adaptation are also available.
The requirement for an age management plan for companies with more than 150 employees is undoubtedly the most significant measure for HR departments. The companies concerned must commit to at least three of the seven areas set out by law, which include planning for career progression, improving working conditions, implementing preventive health measures, skills development and access to training, as well as managing the end of careers and the transition from work to retirement.
This plan is not a mere administrative formality: it constitutes a measurable commitment that must translate into concrete actions integrated into the company’s overall HR policy. Furthermore, since 2018, the government has reimbursed companies 35% of the salary costs associated with training undertaken by their employees aged 45 and over. This scheme is still underused by companies, with the target group having, on average, undertaken less training than the workforce as a whole.
Beyond legal obligations, academic research provides useful insights into what actually works. As part of its WorkAgeing research project on the employment of older workers in Luxembourg, LISER analysed managerial practices and their impact on the performance of intergenerational teams. The results indicate that practices aimed at fostering employee engagement are the most effective at mitigating the negative effects of generational polarisation, whereas financial incentives alone, on the other hand, have no effect.
Furthermore, skills development initiatives, if they are generic and introduced without consideration of the specific needs of employees of different ages, can prove detrimental to performance. This finding argues for a personalised approach, distinct from the standard training programme applied to all.
At an operational level, several measures have proven effective in Luxembourg companies. At Cactus, management places great importance on adapting working conditions to individual circumstances, whether this involves adjustments to working hours, assignments or the organisation of the workstation. These adjustments are not automatic and are initiated by the employee according to their needs.
This on-demand approach, which preserves the employee’s autonomy, is consistent with the ITM’s recommendations on age management in the workplace, which emphasise the need to consult both employers and employees to jointly develop solutions.
The ITM emphasises that in order to be able to work for longer, people must age well, which implies that working conditions from the very start of a career influence employees’ ability to remain in work over the long term.
The intergenerational transfer of knowledge is another key focus, often overlooked by companies that do not sufficiently anticipate the departure of experienced staff. Establishing formal mentoring pairs between senior staff and younger colleagues, promoting the role of mentor within career progression pathways, or involving experienced staff in internal training are practices that are both beneficial to the organisation and a source of fulfilment for the employees concerned.
Contrary to certain preconceptions, older employees still have the motivation to train and continue to develop professionally, but their aspirations do not always come to fruition due to a lack of an environment that genuinely encourages them.
The issue of retaining older workers cannot be resolved as retirement approaches. It is built over time, through HR policies that incorporate active ageing as a normal component of career management rather than an exceptional situation.
Clarifying career paths for the second half of an employee’s career, training managers to recognise age-related biases, utilising ADEM’s financial schemes before the situation becomes critical, and treating the continued employment of older workers as the natural complement to a high-quality outplacement policy are all signals that remaining staff observe closely.
In the Luxembourg labour market, where the rise in unemployment among skilled workers aged 45 and over is documented month after month by ADEM, companies that plan ahead will have a structural advantage over those that wait for the problem to arise.
