Surveys
Luxembourg's Financial Sector Turns More Bullish, But Frets Over Talent Crunch, Inflation - Study

The study of financial industry figures in Luxembourg found them in a broadly positive mood although with some worries, such as inflation.
A study of more than 400 C-suite executives and senior leaders in
Luxembourg’s financial sector finds that over 60 per cent of them
are significantly more upbeat about their business prospects than
a year ago. Even so, respondents are nervous about inflation,
talent shortages and rising protectionist policies.
The survey, conducted by Luxembourg for
Finance in October, showed that more than half of surveyed
individuals expect their organisations to boost global
investments next year, with 33 per cent more taking that view
than in 2020.
That said, survey respondents are wary of emerging macro-economic
risks, most notably asset bubbles and inflation, including the
significant accumulation of public debt, the rapid rise of energy
prices, and skyrocketing real estate prices.
Industry practitioners in Luxembourg are adjusting to changes
including the UK's departure from the European Union, the
disruptions caused by COVID-19, and the changing macro-economic
environment, such as recent rises to inflation.
Increasingly protectionist reactions at a national level are seen
as a key concern, with almost 80 per cent of respondents
indicating concern over the growing fragmentation within the
single market of the European Union. Participants stressed the
need to overcome national action by member state authorities and
rather to focus on an overall EU objective to overcome the loss
of competitiveness currently seen among EU financial actors on a
global stage.
Almost half (49 per cent) of respondents said they were no longer
concerned about the pandemic’s influence on financial services.
Additionally, most of them (58 per cent) were not concerned about
the long-term effects of Brexit.
There’s also a talent crunch: access to talent remains a key
concern for the global financial services industry. In
Luxembourg, 51 per cent of respondents aren’t confident in their
organisations’ ability to address the problem, up from 44 per
cent in April this year.
Respondents struck a confident note in how resilient they are
against cybersecurity threats. Some 79 per cent were confident in
their ability to handle the cybersecurity challenge.
Additionally, the shift to home-based work has been relatively
smooth, with 88 per cent of respondents confident in their
organisations' ability to deal with any possible challenges that
might arise in the coming 12 months.
This news service spoke
a year ago to the Luxembourg funds sector about how
Brexit has affected the UK's ability to tap into to the European
funds market. While access and "passportability" will change,
fears of a freeze-out are exaggerated.