The majority of Utah’s employers will see a reduction in their unemployment insurance tax rates for the 2018 calendar year, the Utah Unemployment Insurance Division announced last week. In 2018, more than 75 percent of Utah’s established employers will qualify for the minimum contribution rate of approximately $34 per employee per year — a 48 percent decrease from 2017. Utah’s taxable wage base increased from $33,100 to $34,300 over the past year, the division said in a release.
For 2017, Workforce Services is projected to collect $185 million in unemployment insurance taxes, which is approximately $170 million less (a 47 percent reduction) than the amounted collected in 2013. This will mark the fourth consecutive year that Workforce Services collected less taxes from Utah employers.
Employers whose former employees were eligible for and received unemployment insurance benefits will see an adjustment in their 2018 contribution rates compared to 2017, with rates ranging from 0.1 percent to 7.1 percent. New employers will pay an industry average, ranging from 1.1 percent to 5.5 percent.
Employers contribute to the Utah Unemployment Insurance Trust Fund to pay benefits to workers who become unemployed through no fault of their own. At the end of the last state fiscal year, the fund had a balance of $1.03 billion, which is within the statutorily desired level. According to the U.S. Department of Labor, Utah’s Unemployment Insurance Trust Fund is the fourth-healthiest trust fund in the nation.
“Proper calculation of the tax rate is critical to help ensure Utah’s Unemployment Insurance Trust Fund remains solvent during times of high unemployment and to ease the tax burden on employers to encourage economic growth,” said Kevin Burt, director of the Unemployment Insurance Division. “Utah’s program is implemented well by our unemployment insurance staff, who work diligently to ensure that only eligible individuals receive the unemployment insurance benefit, and who will continue to support both employers and claimants in understanding and following the rules of the program.”