Luxembourg has shot up five places to second position in the 2023 IMD World Talent Ranking (WTR). So, what is stopping employers from getting the talent they so desperately seek?
Only Switzerland, unchallenged since 2014, outranks Luxembourg in the recently published WTR. It’s a nice bit of PR but as with many of these rankings, the devil is in the detail.
Luxembourg bolstered its position by working on its attractiveness (4th) and investment and talent development (2nd). And yet it is still too early for it to reap the rewards of this investment– the shortage of skills remains its Achilles heel. The ranking showed Luxembourg lost in attractiveness to highly qualified workers (from 7th to 9th). But, it was the “availability of talent” pillar where the grand duchy scored worst. Here business leaders downgraded Luxembourg from 52nd to 55th position on the “availability of skills” aspect.
While the survey is not limited to startups, it is a phenomenon felt only too acutely in the ecosystem where finding tech talent can determine the success of a scale-up. Recruitment of skilled workers was the most-cited challenge facing founders, according to the first Silicon Luxembourg Founder Survey, held in Q4 2022. The Luxembourg chamber of commerce responded to the ranking findings by saying that the country needed to respond to the war on talent in a targeted and rapid manner.
It pointed out that Luxembourg has a number of assets to attract foreign workers, such as a high standard of living (8th), an independent judicial system (20th), attractive salaries for management positions (8th) and one of the highest minimum social wages in the world (4th). Yet, the high cost of living (40th), and housing, coupled with an inadequate apprenticeship system remain major obstacles.