Analyses 02/26 – Luxembourg’s population projections:

This report presents an update of Luxembourg’s long-term demographic and economic projections up to 2070, based on an eco-demographic model that explicitly incorporates the interactions between productivity, wages, migration, population, employment and economic growth.

Compared with STATEC’s 2017 reference publication, the main methodological change involves treating potential GDP growth as an endogenous variable. Productivity becomes the central parameter of the scenarios, whilst potential GDP results from the dynamics of employment, population and hours worked.

The projections show that Luxembourg’s population would continue to grow over the coming decades, reaching between approximately 940,000 and 1,070,000 inhabitants by 2070, depending on the scenario. However, this growth would be significantly more moderate than that observed since the early 2000s, with the annual growth rate falling below 1% on a sustained basis from the 2040s onwards.

In the long term, demographic dynamics would rely almost exclusively on net migration. The natural increase would turn negative from the middle of the century in all scenarios, highlighting the structural role of immigration in Luxembourg’s population growth.
Population ageing would constitute a major and inevitable trend. The population aged 65 and over would almost triple between 2025 and 2070, bringing the old-age dependency ratio to a level of between 49% and 58% depending on the scenario.

Economically, long-term trajectories differ significantly depending on assumptions regarding total factor productivity and investment. Scenarios involving high productivity result in more sustained economic growth, more attractive relative wages and a higher net migration balance.

Sensitivity analyses confirm that migration assumptions are the main determinant of long-term economic and demographic trajectories. Conversely, variations in fertility and mortality have only a limited impact on potential growth over the projection horizon.
These projections are not forecasts but conditional trajectories intended to inform public debate and long-term economic policy choices.