Unemployment Insurance Trust Fund Forecast Report

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Introduction, This report provides information on Washington state s employer contributions benefits. and unemployment trust fund current and projected balances The Employment Security. Department s unemployment trust fund projections are reviewed and adjusted several times. a year The adjustments are made by changing several variables in the trust fund model. which are derived from the state s Economic and Revenue Forecast Council s ERFC. quarterly economic forecast IHS Global Insight and updated unemployment insurance. recipiency rates and by replacing forecasted data with the most current actual data. This forecast uses the November 2018 ERFC assumptions and actual unemployment. insurance tax and benefit data through September 30 2018 The economic assumptions. used for this forecast and the September 2018 forecast are provided in Appendix 1. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 2,Employer contributions, Employer contributions were about 1 11 billion in 2017 and are projected to be. approximately 1 04 billion in 2018 Employer taxes are projected to decrease through 2019. and then gradually increase through 2023 We are seeing this decrease as we get further from. the recent recession because each year s experience rated taxes are based on employers. benefit payments of the previous four years, Figure 1 shows projected annual employer experience tax and social tax contributions. through the end of 2023, Figure 1 Washington state unemployment insurance employer tax contributions. Washington state 2008 through 2023, Source Employment Security Department LMEA ETA 2112 UI Wage File.
In millions, 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023. Experience tax contributions Social tax contributions. Note Highlighted years reflect projected data, Employer tax contributions were about 1 11 billion in 2017 and are projected to be approximately 1 04 billion in 2018. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 3,Unemployment benefit payments, Benefit payments from the unemployment trust fund were approximately 1 06 billion in. 2017 and are projected to drop to 918 9 million by 2019 before increasing steadily. through 2023 Figure 2 shows annual projections of benefit payments from the trust fund. and the projected state unemployment rate through 2023 Federally funded benefits such. as emergency unemployment compensation EUC and extended benefits are excluded. from Figure 2, Figure 2 Benefit payments from state unemployment trust fund. Washington state 2008 through 2023, Source Employment Security Department LMEA ETA 2112 UI Wage File.
In millions,Benefit payments Unemployment rate,Note Highlighted years reflect projected data. Benefit payments from the trust fund were approximately 1 06 billion in 2017 and are projected to drop to 918 9 million. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 4,Trust fund balance, As of November 30 2018 Washington state had 4 68 billion approximately 16 6 months. of benefits in the unemployment trust fund, Figure 3 below shows the annual projected year end trust fund balance through 2023 The. orange line represents the months of benefits available on the date when unemployment. insurance tax rates for the following year are calculated September 30 It is important to. note that individual years can have the same trust fund balance but different months of. benefits There is not one standard cost for a month of benefits this is seen in Figure 3. where 2022 is projected to have a larger trust fund balance than 2021 but fewer months of. benefits The cost of a month of benefits varies depending on how many people in the. state are working and how much they are earning, Figure 3 Washington state unemployment trust fund and months of benefits. Washington state 2008 through 2023, Source Employment Security Department LMEA ETA 2112 UI Wage File.
21 2 16 3 16 2 15 9 15 9,5 000 16 2 16 4 20,Months of benefits. 4 000 15 7,14 2 14 8 14 8,13 4 14 1 15,In millions. Trust fund balance Months of benefits,Note Highlighted years reflect projected data. The trust fund balance was at 16 0 months of benefits in 2017 and is projected to peak at 16 4 months of benefits by 2019. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 5, Trust fund scenario November 2018 forecast compared to September 2018. This scenario compares the November 2018 forecast top to the published September 2018 forecast. Figure 4 Washington state trust fund forecast,Washington state November 2018 and September 2018.
Source Employment Security Department LMEA ETA 2112 ETA 5159 UI Wage File. Unemployment trust fund November 2018 Baseline Forecast. based on actual data through September 30 2018 and November 2018 Washington State Economic and Revenue Forecast Council. Taxes CY 2016 CY 2017 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022 CY 2023. Average experience tax rate percent 1 07 1 00 0 83 0 77 0 75 0 75 0 75 0 75. Experience tax contributions in millions 916 8 948 9 861 3 748 9 752 8 771 9 790 4 811 5. Flat social tax rate percent 0 27 0 25 0 25 0 25 0 25 0 25 0 25 0 25. Social tax contributions in millions 265 9 164 9 177 6 160 2 164 5 168 7 172 8 177 3. Solvency tax rate percent 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00. Solvency tax contributions 0 0 0 0 0 0 0 0, Total average tax rate experience tax social tax 1 38 1 18 1 00 0 93 0 91 0 91 0 91 0 91. Total tax contributions in millions 1 182 6 1 113 8 1 038 9 909 2 917 3 940 6 963 2 988 8. Weeks compensated in millions regular benefits 2 3 2 2 2 0 1 9 2 0 2 1 2 1 2 1. Average weekly benefit amount 443 40 496 19 468 39 478 57 494 53 512 12 530 84 551 95. Regular benefit payments in millions 1 019 0 1 058 4 951 8 918 9 991 0 1 069 2 1 129 3 1 185 1. Total benefit liability in millions 957 9 994 9 894 7 863 7 931 6 1 005 1 1 061 6 1 114 0. Reimbursable benefit payments in millions 61 1 63 5 57 1 55 1 59 5 64 2 67 8 71 1. Total benefit payments in millions 1 019 0 1 058 4 951 8 918 9 991 0 1 069 2 1 129 3 1 185 1. Trust fund, Beginning trust fund balance in millions 3 900 7 4 215 5 4 429 5 4 678 0 4 839 7 4 944 9 5 002 2 5 026 7. Trust fund interest in millions 90 0 95 1 104 3 116 2 119 6 121 7 122 9 123 2. Total tax contributions in millions 1 182 6 1 113 8 1 038 9 909 2 917 3 940 6 963 2 988 8. Reimbursements from reimbursables in millions 61 1 63 5 57 1 55 1 59 5 64 2 67 8 71 1. Total benefit payments in millions 1 019 0 1 058 4 951 8 918 9 991 0 1 069 2 1 129 3 1 185 1. Ending trust fund balance as of 12 31 in millions 4 215 5 4 429 5 4 678 0 4 839 7 4 944 9 5 002 2 5 026 7 5 024 7. Months of benefits available as of 9 30 16 2 16 0 16 2 16 4 16 3 16 2 15 9 15 9. Unemployment trust fund September 2018 Baseline Forecast. based on actual data through June 30 2018 and September 2018 Washington State Economic and Revenue Forecast Council assumptions. Taxes CY 2016 CY 2017 CY 2018 CY 2019 CY 2020 CY 2021 CY 2022 CY 2023. Average experience tax rate percent 1 07 1 00 0 83 0 77 0 75 0 75 0 75 0 75. Experience tax contributions in millions 916 8 948 9 859 3 746 4 749 7 770 0 790 7 811 5. Flat social tax rate percent 0 27 0 25 0 25 0 25 0 25 0 25 0 25 0 25. Social tax contributions in millions 265 9 164 9 177 2 159 7 163 8 168 3 172 8 177 3. Solvency tax rate percent 0 00 0 00 0 00 0 00 0 00 0 00 0 00 0 00. Solvency tax contributions 0 0 0 0 0 0 0 0, Total average tax rate experience tax social tax 1 38 1 18 1 00 0 93 0 91 0 91 0 91 0 91. Total tax contributions in millions 1 182 6 1 113 8 1 036 6 906 1 913 5 938 3 963 5 988 8. Weeks compensated in millions regular benefits 2 3 2 2 2 0 1 9 2 0 2 0 2 0 2 0. Average weekly benefit amount 443 40 496 19 467 05 475 33 492 64 512 75 532 53 553 73. Regular benefit payments in millions 1 019 0 1 058 4 951 2 917 3 962 9 1 022 5 1 067 2 1 131 5. Total benefit liability in millions 957 9 994 9 894 2 862 3 905 1 961 1 1 003 1 1 063 6. Reimbursable benefit payments in millions 61 1 63 5 57 1 55 0 57 8 61 3 64 0 67 9. Total benefit payments in millions 1 019 0 1 058 4 951 2 917 3 962 9 1 022 5 1 067 2 1 131 5. Trust fund, Beginning trust fund balance in millions 3 900 7 4 215 5 4 429 5 4 677 6 4 837 7 4 965 9 5 065 8 5 151 3. Trust fund interest in millions 90 0 95 1 105 8 116 3 119 8 122 7 125 1 126 9. Total tax contributions in millions 1 182 6 1 113 8 1 036 6 906 1 913 5 938 3 963 5 988 8. Reimbursements from reimbursables in millions 61 1 63 5 57 1 55 0 57 8 61 3 64 0 67 9. Total benefit payments in millions 1 019 0 1 058 4 951 2 917 3 962 9 1 022 5 1 067 2 1 131 5. Ending trust fund balance as of 12 31 in millions 4 215 5 4 429 5 4 677 6 4 837 7 4 965 9 5 065 8 5 151 3 5 203 4. Months of benefits available as of 9 30 16 2 16 0 16 3 16 4 16 4 16 4 16 2 16 2. Note The total average tax rate cannot be reached by adding the average experience tax rate and the flat social tax rate due to social tax caps and other factors. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 6,Appendix 1 Economic assumptions, The events since the last forecast have made little impact toward the state s Economic.
and Revenue Forecast Council s outlook for the future Overall revisions to the current. economic forecast call for a slightly less optimistic outlook. The Employment Security Department s unemployment trust fund projections are. reviewed and adjusted several times a year The adjustments are made by changing. several variables in the trust fund model which are derived from the Economic and. Revenue Forecast Council s quarterly economic forecast IHS Global Insight and updated. unemployment insurance recipiency rates and by replacing forecasted data with the. most current actual data Appendix figure A 1 shows the major economic inputs used in. the trust fund model with a comparison to the prior forecast. Appendix figure A 1 Washington state economic and revenue projections. Washington state November 2018 and September 2018, Source Washington State Economic and Revenue Forecast Council IHS Global Insight. Unemployment rate percent of workforce Personal income percent growth. Year Nov 18 Sept 18 Year Nov 18 Sep 18,2016 5 44 5 44 2016 7 33 7 33. 2017 4 76 4 76 2017 6 10 5 60,2018 4 56 4 60 2018 6 90 6 60. 2019 4 15 4 17 2019 4 70 5 20,2020 4 32 4 22 2020 5 00 5 10. 2021 4 49 4 30 2021 4 80 4 80,2022 4 57 4 32 2022 4 70 4 80.
2023 4 61 4 40 2023 4 90 4 70, Employment growth percent growth Consumer Price Index percent growth. Year Nov 18 Sep 18 Year Nov 18 Sep 18,2016 2 44 2 44 2016 1 30 1 30. 2017 2 40 2 40 2017 2 10 2 10,2018 2 70 2 90 2018 2 40 2 60. 2019 2 20 2 10 2019 1 90 2 20,2020 1 50 1 40 2020 2 00 2 20. 2021 1 00 0 90 2021 2 20 2 00,2022 1 00 0 90 2022 2 20 2 00.
2023 1 00 0 70 2023 2 10 2 00, Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. 01 22 2019 Page 7,Definitions of economic variables. Unemployment rate The rate computed by dividing total unemployed by the. civilian labor force The unemployment rate is used as an input into the. forecasting of benefits These unemployment rates are seasonally adjusted. Seasonal adjustment smooths out the impact of normal seasonal patterns that. occur year after year such as strong seasonal hiring in retail trade around the. Wage and salary disbursements This component of personal income consists of. the monetary remuneration of employees It reflects the amount of wages and. salaries disbursed but not necessarily earned during the year This component. is measured before deductions such as Social Security contributions and union. dues The percentage growth for wage and salary disbursements is used in. projecting future wages, Employment growth The percentage change in overall employment from. year to year Employment growth is used in the trust fund model as a. means of forecasting total employment, Consumer Price Index CPI A measure of the average change over time in the. prices paid by urban consumers for a market basket of consumer goods and. services CPI is used in the forecast as a means of adjusting the dollar values. Employment Security Department November 2018 Unemployment Insurance Trust Fund Forecast. Unemployment Insurance Trust Fund Forecast November 2018 Executive summary This report provides tstatushe and updated projections of the state s unemployment insurance trust fund for 2016 through 2023 As of November 30 2018 the Washington state Unemployment Insurance UI trust fund ending balance was 4 68 billion Unemployment benefit payments for fiscal year 2018 totaled 1 0 billion

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