State unemployment tax won’t increase |

State unemployment tax won’t increase

In a rare bit of good news for businessmen, the state has decided not to increase the tax that pays unemployment benefits for those out of work because of the recession.

Employment Security Division Administrator Cindy Jones decided to keep the tax at 1.33 percent for 2009.

The tax is applied to the first $25,400 each individual worker earns during the year.

Jones did so despite the fact her economists have predicted the rising number of those without jobs will draw that fund down from the $703 million now in the account to $450 million by the end of 2009.

Jones said that is $119 million below the target the division would like to keep in the fund but that she didn’t want to increase the burden on employers.

“When facing the increased demand on the system caused by an economic downturn, two things happen in the trust fund,” said economist Dave Schmidt. “Total contributions flatten out or decline and total benefits rise dramatically.”

With about 40,000 checks being mailed every week, the trust fund is being drawn down faster than ever. Unemployment in Nevada reached a 23 year high in October ” 7.3 percent.

The 1.33 percent is the overall rate applied to the more than 60,000 employers who pay the tax. Those with the best records for keeping workers and not causing them to draw unemployment get the best rates. In Nevada, nearly half of those employers pay just a quarter percent of payroll. 

Those who are unemployed also got some good news this week as the department can now extend unemployment benefits from a maximum of 13 weeks to 20 weeks.

The additional benefits were authorized by Congress and President Bush in late November.

In addition, the legislation allows another extension for those still out of work.

Jones said a notice has been sent to claimants who have exhausted their first round of benefits telling them how to get the checks coming again.

Those who are still without work can file a normal weekly claim on the Internet at or call 684-0350.

– Contact reporter Geoff Dornan at or 687-8750.