Luxembourg’s Chamber of Skilled Trades and Crafts (Chambre des Métiers) has criticised the government for failing to develop a “holistic and coherent policy” for the professional and social integration of migrants and refugees, saying that excessive bureaucracy continues to keep many people out of work and dependent on social benefits.

In its latest economic report, the chamber said “activating these people is crucial” to improving their job prospects and reducing long-term welfare dependence. The call comes as the labour market continues to face shortages in key sectors such as construction, craft trades and manufacturing.

According to figures from national employment agency Adem, 887 asylum seekers (DPIs) are currently registered as jobseekers. The employment rate among people with international protection (BPIs) is expected to reach 33.6% in 2025, or around 1,700 people out of roughly 5,000 refugees of working age.

Access to the labour market is currently severely restricted for both asylum seekers and those granted asylum due to administrative requirements and layers of bureaucracy. Yet, skilled labour shortages still exist in several sectors.

887 persons entitled to asylum (BPI) are currently registered as jobseekers with the ADEM.  © Photo credit: Chris Karaba

Skilled labour shortage persists

The Chambre des Métiers said 850 vacancies in craft and skilled trade businesses are currently registered with Adem, down from 1,500 in March 2022 amid a slowing economy. Even so, 23% of companies reported being affected by labour shortages in the second quarter of 2025, up from 12% a year earlier.

Employers say the situation is made worse by cumbersome administrative rules. Asylum seekers are barred from working during the first six months after submitting their application, and once permitted, must apply for temporary work permits (AOT) that are valid for only six months and require constant renewal.

The chamber said those delays and restrictions keep refugees “inactive” and make it harder for businesses to find qualified staff. “Meaningful work is essential to integration into Luxembourg’s social life,” it said.

Reform proposals

To speed up entry into the workforce, the chamber proposes an immediate assessment of new arrivals’ skills, allowing targeted training and language learning from the outset. It also urged the government to abolish the six-month work ban for asylum seekers and streamline the AOT process to cut red tape for employers.

Those pursuing vocational training face further barriers: they must already hold a residence permit and have paid social contributions for at least a year to start their course. The chamber said those conditions should be removed.

It also suggested that asylum seekers should be allowed to complete a vocational programme even if their application for refugee status is refused. Asylum seekers who successfully complete training and find a job could be given priority access in their asylum procedure, the chamber suggested.

“This could be of particular interest to skilled trades where there is a shortage of skilled workers and could be a possible component of the government’s comprehensive talent strategy,” the chamber said.

(This article was originally published by the Luxemburger Wort. Translated using AI and edited by Kabir Agarwal)