Jobless insurance rates rise for some ND employers

AP News
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Posted: Dec 04, 2009 8:16 PM

North Dakota's unemployment insurance rate will stay the same for a majority of businesses in 2010, even though benefit payments more than doubled this year, a Job Service North Dakota administrator said.

About 14,000 of the more than 20,000 businesses will continue to have a tax rate of 0.20 percent for their coverage in 2010, said Darren Brostrom, director of the agency's unemployment insurance division.

For businesses with the best records of avoiding layoffs, the maximum insurance cost for each worker will rise by 4.2 percent next year, to $49.40 per employee. Although the insurance rate will stay the same, it will be assessed in 2010 against a worker's first $24,700 of wages, compared to $23,700 this year.

North Dakota's monthly unemployment rates have consistently been among the nation's lowest, but layoffs and job furloughs at some large businesses _ such as Bobcat Co., which is closing its Bismarck construction equipment factory _ have driven up benefit payments, officials said.

Most of the factory's 475 jobs are being shifted to another company plant in Gwinner, in southeastern North Dakota.

Job Service paid $47.3 million in unemployment benefits to workers in 2008. This year, the figure is expected to rise to $105 million by year's end, Brostrom said.

"What we saw this year was some short-term layoffs," he said. "Obviously that was better for the employees, because they're not being permanently laid off, but it does draw down benefits that may not normally have been paid."

Employers who have paid more in unemployment insurance taxes than their workers have collected in benefits receive the most favorable insurance rates. The maximum cost per worker for those businesses will range next year from $49.40 to $375.44, depending on a comparison of each company's taxes paid, benefits drawn and its total payroll expense.

For employers whose workers have drawn more in benefits than the company has paid in taxes, the insurance bill is much higher. The maximum annual payment in 2010 will range from $1,561 per worker to $2,470.

Job Service estimates it will collect $69.5 million in unemployment taxes from businesses next year, a 35 percent increase from 2009. The system covers more than 340,000 employees.

North Dakota's unemployment insurance fund is healthy, with a balance of $95.6 million, Brostrom said. Next year's target balance is $83.7 million.