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Abstract: Introduction

We can distinguish three main types of work-integration structures in Luxembourg:

• structures recognised of socio-economic utility (integration through economic activity enterprises);

• initiatives belonging to the solidarity-based economy (local development and neighbourhood works);

• integration structures for the handicapped (sheltered workshops). The socio-economic context of Luxembourg has specific characteristics:

• it is a little open economy with a strong and uninterrupted growth (6.4% per year on average);

• there is a chronic shortage of workforce, linked to a growth of the domestic rate of employment of 5% per year and a low unemployment rate (< 3%). People needing support to achieve socio-occupational integration are faced with a strong competition from jobseekers from border regions of neighbour countries:

• in quantitative terms: there are between 15 and 25 unemployed workers from these border regions (Saarland - Lorraine - Belgian Luxembourg) for each Luxembourguese unemployed worker, and there are even more qualified persons who already have a job;

• in qualitative terms: the vast majority of the Luxembourguese unemployed have a very low level of qualification (85% of them do not have a secondary school degree); very often, their only comparative advantage lies in the fact that they know the country's three languages;

• in terms of salary: the nominal salary cost is constantly pushed up (+4.5% in 2001) in a labour market characterised by a low rate of unemployment, especially for skilled workers. This situation of competition reinforces the problem of structural unemployment in the country. About one third of jobseekers are considered as "particularly hard-toplace" by the Administration of Employment, among other reasons because of their social situation. Jobs for low-qualified workers are usually occupied by workers from neighbour countries, with the result that inactivity periods are made longer for the most difficult-to-place Luxembourguese jobseekers. These circumstances led the successive governments to support initiatives for the socio-occupational integration of the most vulnerable groups on the labour market. In a first stage, the projects were selected on the basis of distinct criteria (specific actions, target group, sector of industry, etc.), but they have been maintained up to now in a logic of "pilot projects". This explains the heterogeneity of the various experiences and of their legal frameworks, in the absence of a specific and adapted legislation. Given the discrepancy between the qualifications of jobseekers and the however numerous job offers, a large part of work-integration actions aim at the training of jobseekers and many structures have mostly training activities. Finally, we cannot omit to mention the serious social handicaps of the majority of people employed in work-integration structures; all of these structures have had to implement very significant social support and guidance strategies.

Keywords: Work Integration Social Enterprises; Luxembourg; unemployment

Language: English

24 pages, 2003

Note: Available online at: http://www.emes.net/fileadmin/emes/PDF_files/ELEXIES/ELEXIES_WP_03-02_GDL.pdf

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RePEc:hhh:senior:2003_007

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