Businesses are paying higher unemployment taxes - WFSB 3 Connecticut

Businesses are paying higher unemployment taxes

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(WFSB) (WFSB)
HARTFORD, CT (WFSB) -

Connecticut businesses didn’t create the unemployment problem, but they are being asked to pay for it.

Gary Bergeron said he just found out it is going to cost him more to keep his trailer company in business.

"I think it’s much worse than what is really out there,” he said,

Every Connecticut business pays a federal unemployment tax, but it has gone way up.

In 2010, it cost $42 per year for each employee, and now it is at $189.

Bergeron said he was paying $966 per year, and now it costs him more than $4,000.

Businesses pay into the state’s unemployment fund, which pays out benefits.

However, during the recession, that fund ran out of money.

The state ended up borrowing money, but there’s interest on the loan.

While the recession has impacted just about every state, many have made reforms to soften the blow.

"If Connecticut businesses jumped across the border to MA, NY or RI, they would be paying a quarter of that,” said Eric Gjede, of CT Business and Industry Association.

The CT Business and Industry Association said other states have made reforms, and because Connecticut hasn’t, the state is paying the highest federal unemployment insurance tax in the country.

In a statement, the State Department of Labor said "We have made recommendations but we have been unsuccessful modifying Connecticut's complex unemployment system."

Connecticut businesses fed up with high taxes said if the state doesn’t do more to help, more businesses will leave.

"Just the attitude of the state towards businesses makes it difficult for us to do anything,” Bergeron said.

The good news is the tax will be paid off at the end of the year, however if something isn’t done, the fund will still be empty and Connecticut will end up in the same bad place.

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