Georgia’s many employers on the hook for unemployment insurance taxes are set to see some relief in the near future, thanks to a loan repayment on the state trust fund used to pay benefits since 2009.

According to the Georgia Department of Labor, Gov. Nathan Deal and State Labor commissioner Mark Butler announced the nearly $1 billion federal loan repayment on May 19. Prior to this statement, the expected payoff date was in 2016. As a result, this fast turnaround could lead to a reduction in unemployment insurance taxes for the state’s employers.

“By repaying the loan early, it will save our employers from having to pay approximately $600 million in additional federal unemployment taxes,” Butler said in a statement. “That money can now be used to create jobs and grow our state’s economy. And, now that the loan is repaid, our employers will see a reduction of $63 per employee in their federal unemployment taxes beginning in January.”

In December 2007, the unemployment insurance trust fund had a balance of over $1 billion. However, the ensuing recession nearly doubled Georgia’s jobless rate, and by 2009 funds had run out. Since then, the state has been borrowing from the federal government and relying on local taxes to repay the debt.

Unemployment rate declines on yearly basis
The main reason why the unemployment trust fund ran out over the past several years in Georgia has been the extremely high number of workers out of a job. Now, trends have improved, and that is good news for local residents and businesses.

The Georgia Department of Labor reported that the state’s unemployment rate was at 7 percent in April, lower than the 8.3 percent noted during the same time in 2013. This changed has been helped along by job growth and an improved economy, leading to more opportunities for local workers.

“We had very strong job growth in April, as our employers created 41,300 new jobs, which is the largest March to April increase since 2005,” Butler said in a statement. “And, to make things even better, more jobseekers are entering the labor force and getting hired. This is a stark contrast to what we’re seeing nationally with hundreds of thousands of people leaving the labor force.”

In addition, the DOL explained that there were more than 33,000 new claims for unemployment insurance this past month, nearly 9 percent higher than in March.

Juggling tax rates, expenses, and difficult employees can become challenging at your company. Here at Corporate Cost Control, we understand these problems and are well-positioned to help. Our extensive background in cost control and human resources will allow you to better manage your unemployment insurance expenses.


Contact CCC to see how we can save your organization time and money.
Contact our Sales Team
(800) 207-6926

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