Average Unemployment Insurance Tax Rates Decrease for Texas Employers

Date: Dec. 6, 2018

Media Contact: Lisa Givens
Phone: 512-463-8556

Texas Workforce Commission sets employer tax rates for 2019

AUSTIN ⎯ The Texas Workforce Commission (TWC) today announced the average unemployment insurance (UI) tax rate for all employers will be 1.25 percent for calendar year (CY) 2019, dropping from 1.37 percent in CY 2018 to its lowest point since 2009. The average tax rate for experience-rated employers is 1.06 percent for CY 2019, and is down from 1.20 percent in CY 2018.

The minimum tax rate is paid by 340,158 employers, which represents 65.6 percent of experience-rated employers. The standard minimum UI tax rate paid by Texas employers in CY 2019 will be 0.36 percent, which is down from 0.46 percent in CY 2018. These employer-paid UI taxes replenish the Texas Unemployment Compensation Trust Fund, which provides temporary income for Texas workers who lose their jobs through no fault of their own.

An experience rating is determined by the amount of an employer’s taxable wages and the amount of UI benefits that have been paid to former employees and charged to the employer’s account for the last three years. An employer paying the standard minimum tax will pay $32.40 per employee in CY 2019 on the first $9,000 in wages per employee compared with $41.40 per employee in CY 2018. The maximum UI tax rate, paid by 5.3 percent of Texas employers, will be 6.36 percent, decreasing from CY 2018 at 6.46 percent.

TWC is dedicated to finding ways to lower the financial impact of UI taxes on Texas employers. TWC and its 28 local workforce boards also are committed to helping UI claimants return to work as soon as possible. Through automated processes and database cross matches with state and federal agencies, TWC continues to strengthen and improve efforts to detect and prevent UI fraud. TWC pledges to continue efforts to keep taxes as low as possible and minimize the effects on Texas employers.

Because the Texas Unemployment Compensation Trust Fund has risen above its statutory minimum required balance, TWC will not charge employers any deficit tax in 2019. The components of the CY 2019 tax rate are as follows:

  • The general tax rate is based on claims against an employer’s account. If TWC has paid benefits to former employees who were laid off or separated through no fault of their own in the past three years, then those employers will pay a general tax.
  • The replenishment tax rate is charged to all experience-rated employers to cover unemployment claims not charged to a specific employer. This tax tends to rise following economic slowdowns when claims increase and businesses close.
  • The employment training assessment is imposed on each employer paying contributions under the Texas Unemployment Compensation Act as a separate assessment of 0.10 percent of wages paid by an employer. Money from the assessment is deposited to the credit of the employment and training investment holding fund.

The following table lists UI tax rates for Texas employers from calendar years 2003 to 2019.

Year

Taxable
Wage Base

Minimum
Tax Rate

Maximum
Tax Rate

Average
Tax Rate

Average Experience
Tax Rate

2019

$9,000

0.36%

6.36%

1.25%

1.06%

2018

$9,000

0.46%

6.46%

1.37%

1.20%

2017

$9,000

0.59%

8.21%

1.64%

1.51%

2016

$9,000

0.45%

7.47%

1.46%

1.30%

2015

$9,000

0.47%

7.49%

1.54%

1.40%

2014

$9,000

0.51%

7.41%

1.66%

1.54%

2013

$9,000

0.54%

7.35%

1.82%

1.71%

2012

$9,000

0.61%

7.58%

1.96%

1.87%

2011

$9,000

0.78%

8.25%

2.03%

1.96%

2010

$9,000

0.72%

8.60%

1.83%

1.74%

2009

$9,000

0.26%

6.26%

0.99%

0.78%

2008

$9,000

0.10%

6.10%

0.92%

0.65%

2007

$9,000

0.29%

7.70%

1.30%

1.13%

2006

$9,000

0.40%

7.64%

1.51%

1.37%

2005

$9,000

0.58%

8.02%

1.74%

1.63%

2004

$9,000

0.67%

8.26%

1.74%

1.64%

2003

$9,000

0.67%

8.47%

1.68%

1.56%

Wages often can be the largest portion of expenses for a business. As Texas business owners begin staffing plans for the next year, TWC invites businesses to access data from its annual Occupational Wage Survey, which can provide valuable insights on competitive wages for all types of positions for any area in Texas. Access the data at, https://texaswages.com/. Information gathered in the survey is confidential and is reported from Texas employers who participate in the survey. For more information or to participate and assist in making Texas more competitive in the labor marketplace, please contact us by emailing oesinfo@twc.state.tx.us or by calling 1-800-252-3616.

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The Texas Workforce Commission is a state agency dedicated to helping Texas employers, workers and communities prosper economically. For details on TWC and the services it offers in coordination with its network of local workforce development boards, call 512-463-8942 or visit www.texasworkforce.org. To receive notifications about TWC programs and services subscribe to our email updates.

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