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Luxembourg

Social economy at a glance

moderately developed*
Level of development
9.90%**
Estimated share of employment
25 345**
Estimated paid employment

In Luxembourg, in 2019 930 enterprises were registered with social enterprise status. Organisations operating under this status are united by a core mission to have social impact rather than make a profit for their owners or shareholders. Social enterprises in Luxembourg work to provide goods and services for the market in an entrepreneurial and innovative fashion while using profits primarily to achieve social objectives. They are managed in an open and responsible manner and, in particular, involve employees, consumers and stakeholders affected by their commercial activities. Beyond social enterprises, the social economy in Luxembourg is also composed of:

  • 850 associations,
  • 56 foundations,
  • 10 cooperatives,
  • 22 societies,
  • 5 institutes,
  • 144,444 registered companies.

Source: Social Enterprises and their ecosystems in Europe, Country Reports, Luxembourg, 2019

More recent data available for Luxembourg:

As of 2020, there are 2135 entities active in the field of social economy.***

 

* For this website we included this overall assessment of the level of development, it is based on the data and information about the social economy ecosystem currently available and therefore has some limitations. However, we still considered it useful to include this overall assessment.
** Source: EESC/CIRIEC (2016) Recent evolutions of the Social Economy in the European Union, please note that this estimate is on the high end as it is based on organisation type and did not apply a more narrow check for all elements in the social economy definition.
*** Source: Portail de l'économie sociale et solidaire, Ministry of Labour, Employment and the Social and Solidarity Economy.

For more details on the data quality see our note on social economy data.

Tradition and origins

Europe’s first ever ministry for social and solidarity economy (SSE) was established in Luxembourg in 2009. Historically, civil society activities mainly happened in the context of the church. In the late 19th and 20th centuries, most were associations that mainly targeted recreational activities and almost all were linked to the Catholic church with some taking the form of charities. A number of cooperatives were launched in rural areas in the early 20th century but received little support from trade unions. In addition, some mutuals also existed that were connected with various social services with the excpection of healthcare.

The 1970s welcomed new welfare state social services legislation which enabled the work integration of social enterprises (WISEs) in the 1980s. In the 2000s and 2010s, diverse initiatives began to develop, but their categorisation was fiercely debated. In 2016, Luxembourg’s Social and Solidarity Economy Union (ULESS) adopted a legal definition of SSE, but the debate on categorisation is still vivid. 

Framework conditions and social economy ecosystem

Policy and legal framework 

Luxembourg has not yet established the legal status of social enterprises. However, some initiatives and laws have started to recognise the role and need for support of the social economy in Luxembourg. For example, the creation of SIS (Society of Societal Impact) scheme offers a legal statute for certain social enterprises which are primarily focused on the redistribution of profit.

In 2018, the coalition signed an agreement including the development of the social economy as an objective. According to current road map, the social impact company model is to be promoted by the creation of a specific brand and the legal framework further improved in the course of the period 2023 to 2024.

Policymakers in the field of the social economy 

Policies on social economy in Luxembourg is managed by the department of social economy, which is attached to the ministry of Labour and Employment. It often collaborates with local municipalities.

Networks, federation and representative entities 

Social economy in Luxembourg is mostly represented and structured by sectoral networks:

  • COPAS represents care providers,
  • FEDAS represents social care associations,
  • FNML represents mutual societies

The only umbrella organisation approaching social and solidarity economy (SSE) as a whole is the Luxembourg Union for SSE (ULESS). It aims to become the sector's official voice. The ULESS had around 70 members and claims to represent approximately 300 social economy enterprises indirectly or directly.

Get support

Luxembourg offers a number of support schemes – both public and private - designed to help social entrepreneurs and social innovators reach their full potential. The following is an overview of some key initiatives.

The department of social economy provides infrastructural supports and solutions such as

  • The dedicated digital platform The Social Business incubator (SBI). The SBI supplies office facilities and training programs for those involved in social enterprises throughout Luxembourg and specialises in developing tailored solutions to help new social enterprises grow and thrive in the wider economy. 
  • 6zeor1 is Luxembourg’s first incubator for social entrepreneurs. Operated by the government, this programme offers a holistic approach to mentoring, networking, training and events for those who wish to establish a social enterprise in the country, with many of their initiatives taking a digital form.
  • The label "Impact Luxembourg" allows companies recognised under the legal status of "Societal Impact Companies" to be clearly identified as major players in the Social and Solidarity Economy in Luxembourg and gives them more visibility.

Some private actors can also provide support, even though it is not always exclusively designed for social economy and social entrepreneurs, this latest can still benefit from it : 

Funding

The government funds social economy in Luxembourg, especially by mobilising European funding. Some social enterprises in Luxembourg can also rely on the following private sources :

For more detail on accessing financial support, read the OECD report on the social and solidarity economy in Luxembourg here.

Learn more about the social economy in Luxembourg

Reports

Videos

Social Economy Voices

Social Economy Voices - Secondhand4KIDS, Luxembourg