Jobless fund steady despite rising claims

| Print |  Email
Archives - February 2009
Sunday, February 01, 2009

STATEWIDE — Oregon’s unemployed drained more than $318 million from the state’s unemployment insurance trust fund in fourth-quarter 2008, as the number of claimants rose to 105,451 by year’s end.

Despite the mammoth payout, Oregon maintains one of the nation’s strongest-performing trust funds. Even if current economic conditions deteriorate, Oregon has enough money in the trust fund — $1.9 billion — to pay benefits for another 23 months. Oregon’s trust fund is one of the most solvent in the nation, according to Oregon Employment Department spokesman Craig Spivey.

Each state typically funds UI benefits by assessing payroll taxes which are pooled into a trust fund. If a state possesses enough reserves to cover 18 months of benefits at its “highest cost” period, or time at which benefits payments were at their highest, without relying on UI payroll tax revenues, its trust fund is considered solvent.

But several states, including California and South Carolina, doled out more benefits payments than they collected in payroll tax revenues last year, meaning their UI trust funds will dry up quickly as the recession worsens. In total, 19 states risk trust fund insolvency in 2009, according to a report by the National Employment Law Project.

“The beauty of Oregon’s tax schedule is that it won’t allow it to happen,” says Spivey. “Even if we did not bring in another dime, the trust fund would last us awhile.”

Oregon uses an eight-tier tax schedule to ensure the trust fund remains solvent. Each September, OED economists evaluate the solvency of the trust fund to determine the proper tax schedule. Given the doubling of UI claims and growing payouts, the OED will implement a tax schedule in 2009 that will mean an increase in payroll taxes.

NICOLE STORMBERG



Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

More Articles

Healthcare Perspective

November/December 2014
Wednesday, October 22, 2014
BY KIM MOORE

A conversation with Majd El-Azma, president and CEO of LifeWise Health Plan of Oregon, followed by the Healthcare Powerlist.


Read more...

Corner Office: Pam Edstrom

January-Powerbook 2015
Saturday, December 13, 2014

Seven tidbits of information from an agency partner and co-founder of Waggener Edstrom in Lake Oswego.


Read more...

Shifting Ground

November/December 2014
Wednesday, October 22, 2014
BY JOE ROJAS-BURKE

Bans on genetically modified crops create uncertainty for farmers.


Read more...

Shuffling the Deck

November/December 2014
Wednesday, October 22, 2014
BY JON BELL

Oregon tribes still bet on casinos.


Read more...

Free Falling

Contributed Blogs
Thursday, December 18, 2014
121714-oilprice-thumbBY JASON NORRIS | OB CONTRIBUTOR

The implosion of the energy complex: The best thing for low oil prices is low oil prices.


Read more...

Top stories in 2014

The Latest
Thursday, December 18, 2014
10-listthumb

2014 was a year of wild contradictions, fast-paced growth and unexpected revelations.


Read more...

Leading with the right brain

News
Tuesday, December 09, 2014
120914-manderson-thumbBY LINDA BAKER

On the eve of the Portland Ad Federation's Rosey Awards, Matt Anderson, CEO of Struck, talks about the transition from creative director to CEO, the Portland talent pool and whether data is the new black in the creative services sector.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS