Posts for November 23, 2010

FED LOWERS ECONOMIC OUTLOOK

Today in Manufacturing
Officials say the economy will grow only 2.4 percent to 2.5 percent this year, down sharply from a previous projection of 3 percent to 3.5 percent ... continue

AIR FORCE FIRES 2 AFTER TANKER MIX-UP

Today in Manufacturing
Two people have been fired from the service's aerial refueling tanker program after confidential information was mistakenly sent to competing contractors ... continue

41 STATES SEE JOB GAINS IN OCTOBER

Today in Manufacturing
Businesses and other employers added jobs in 41 states in October, the best showing in five months, the Labor Department said Tuesday .... continue

OIL PRICES SLIDE ON GLOBAL UNCERTAINTY

Today in Manufacturing
Crude prices dropped for third day on worries about global economy after China took additional steps to control inflation, and North and South Korea clashed ... continue

NEW DEPUTY DIRECTOR FOR THE GOVERNOR’S OFFICE OF ECONOMIC DEVELOPMENT

Utah Talk
Spencer Eccles, Executive Director of the Governor’s Office of Economic Development (GOED) announced today that he has named Derek Miller as the GOED Deputy Director. “Governor Herbert's vision for the State is that Utah will lead the nation as the best performing economy and be recognized as a premier global business destination and Derek will play a key part in achieving this vision.”

NEWSWEEK CALLS UTAH ‘PROMISED LAND' FOR BUSINESS

Utah Talk
"From a recruiting standpoint, it's phenomenal for us," says Spencer Eccles, executive director of the Utah Governor's Office of Economic Development. Eccles and his counterparts are thrilled to be getting so much praise. Both Newsweek and Forbes magazine agree that Utah is one of the best in the nation at bringing companies to the state.


WORKFORCE SERVICES UNEMPLOYMENT INSURANCE DIVISION TO RELEASE 2011 UI RATES FOR ALL UTAH EMPLOYERS NOVEMBER 30

Below is an advance copy of the explanation letter to be released November 30 to all Utah employers announcing their individual unemployment insurance rates for 2011. Each letter will be individual with employer-specific information. UMA president Tom Bingham serves on the UI Advisory Council representing employers. The UI Advisory Council recommends actions for the Division. Formulas enacted several years ago setting automatic triggers to move the minimum adequate and maximum adequate levels in the Trust Fund have prevented Utah’s trust fund from going insolvent, even in these very difficult time. Near record high unemployment has caused a tremendous strain on the fund and causing the need for an increase in rates to maintain solvency. However, the UI Advisory Council continues to watch the fund carefully to be sure it does not go insolvent. The letter below is a sample of what employers can expect to receive in the mail early in December.

November 30, 2010

Dear Employer:
Enclosed is your Unemployment Insurance (UI) Contribution Rate Notice for 2011. Many employers will experience an increase in Contribution (tax) rates this year. With the higher benefit costs associated with the economic downturn, there has been a significant decline in the UI Trust Fund balance over the past two years. The good news is that Utah’s UI Trust Fund remains solvent; however, well over half the states have UI Trust Funds that are currently insolvent and these states are borrowing funds to pay benefits.

It became necessary to increase tax rates including minimum rates for 2011 to increase the reserves necessary to ensure the long-term solvency of the fund. If an employer has not had UI benefit costs charged to its account (during the last four fiscal years), it is entitled to the minimum tax rate known as the “Social Costs” and is the same for all employers.

Approximately half of all Utah employers have the minimum UI tax rate of .004 (.4%) for the 2011 rate year. This has increased from .002 (.2%) for the 2010 rate year. While we remain sensitive to any rate increase, the 2011 rate is similar to the 2005 and 2006 minimum rates. Based on our current economic forecasts, the department is hopeful the UI Trust Fund will remain solvent in the coming years. While the new rates will be difficult for many Utah employers, most states have also been required to raise their UI tax rates for similar reasons during this period and Utah employers still have lower average UI tax rates in comparison

An employer’s overall tax rate is based on a statutory formula that factors in several components to insure the solvency of the Trust Fund and to equitably adjust tax rates on employers that are responsible for generating these costs. A significant component of the tax rate is an employer’s past UI benefit charges and taxable payroll for the past four years ending June 30, 2010. The total unemployment benefits paid to your former employees, if any, should agree with the totals found on the Statement of Unemployment Benefit Costs, Form 66, which you receive each quarter. You can also obtain quarterly information of any benefit costs and your taxable wages from our website at http://jobs.utah.gov/ui/employer/login.aspx and logging into your account and going to “Display Benefit Costs” (on the left side of the screen).

The taxable wage base has increased from $28,300 to $28,600 for calendar year 2011. The taxable wage base is the maximum amount upon which contributions are paid on each employee’s wages for the year.

While reviewing your rate notice, please be aware that the Department of Workforce Service is committed to ensuring the Utah UI trust fund remains solvent and all Utah employers are treated equitably and fairly.