socastcmsRssStartIllinois News NetworksocastcmsRssEnd
Most employers in Illinois will see reduced payroll taxes in 2019 as unemployment continues to decline.
The Illinois Department of Employment Security announced lowering unemployment insurance taxes for more than 90 percent of employers in 2019. Nearly 300,000 businesses will see lower rates with the move.
Illinois Department of Employment Security Public Information Officer Bob Gough says it’s a good sign for the state’s economy.
"When you have 322,000 employers actually who are registered to pay taxes and nearly 300,000 of them get to see their rates drop, we think that’s some pretty good news," Gough said.
The UI rates are based on a ratio of how many claims are paid to out to unemployed people versus taxable wages. The state unemployment rate in September came in at 4.1 percent, which is the lowest number it has been in 19 years, since February 1999.
"When you have lower unemployment, employers also don’t have to pay as much into their unemployment insurance fund. So that’s how we’ve been able to lower them," Gough said.
Illinois businesses paid in $1.9 billion to the fund this year. Businesses are expected to contribute $1.66 billion next year in 2019, an estimated $240 million decrease.
"In 2019, they are slated to pay about $1.66 billion, so roughly 50 percent lower than it was back in 2012," Gough said.
The Unemployment Insurance Trust Fund pays out unemployment benefits to workers who lose their jobs through no fault of their own. It is funded through taxes paid by employers. The fund balance at the end of the year will hit a near-record high of $1.9 billion.
Of the 322,446 businesses registered to pay unemployment insurance taxes, 297,695 will see rates drop. There were 241,955 businesses that did not have any unemployment claims filed against them in 2018, according to figures provided by IDES.