Astoria, OR – Oregon employers will face the same unemployment insurance tax rate in 2025 as they did in 2024, according to the state’s Employment Department. New employers in the state will continue to pay a rate of 2.4%, while businesses that have been operational for at least one year will remain on the same tax schedule as they were in the previous year.
In addition to the unchanged tax rates, the taxable wage base for unemployment insurance will rise slightly. In 2025, employers will pay unemployment insurance taxes on wages up to $54,300 per employee, up from $52,800 in 2024.
The taxes collected from employers go into Oregon’s Unemployment Insurance Trust Fund, which is used to provide weekly benefits to individuals who lose their jobs through no fault of their own. Oregon’s self-balancing trust fund has been praised for its stability, and officials say it remains one of the healthiest in the nation.
David Gerstenfeld, the director of the Oregon Employment Department, emphasized the trust fund’s resilience during a press briefing in November. He noted that Oregon managed to avoid raising taxes or borrowing money during the economic strains caused by the COVID-19 pandemic, a strategy many other states had to adopt to stabilize their unemployment systems.
“Oregon’s unemployment insurance trust fund is solvent and ready for whatever the next recession brings,” Gerstenfeld said. He also pointed to the trust fund’s interest earnings, which amounted to more than $125 million in 2023 and over $80 million in 2024, further contributing to its strength.
The stability of the trust fund has helped keep tax rates steady. The state’s unemployment rate, which has remained around 4% for more than a year, has not caused a significant increase in the number of benefit recipients drawing from the fund. While the unemployment rate has crept up slightly from its historically low levels in mid-2023, it remains below 4.5%, a rarity for Oregon in recent decades.
“It is rare by historical standards for Oregon’s unemployment rates to be at or below 4.5%,” said Gail Krumenauer, the state’s employment economist. “The only times that’s happened since 1976 have been in the years leading up to the pandemic recession and now in the last couple of years.”
In addition to unemployment insurance, Oregon employers also contribute to the Paid Leave Oregon Trust Fund. This program, which began in 2023, provides paid leave for a variety of reasons, including family, medical, and “safe leave” for those escaping domestic violence or sexual assault. In 2024, employees contributed 0.6% of their gross pay, while employers contributed 0.4%, on wages up to $132,900.
For 2025, these contribution rates will remain unchanged, but the wage base will increase to $176,100. The program allows for up to 12 weeks of paid leave for most eligible employees, with a higher limit of 14 weeks for those taking leave for pregnancy-related reasons.
A new addition to the Paid Leave Oregon program, effective January 2025, is the “pre-placement leave” benefit. This leave is designed for employees involved in the adoption or foster care process, allowing them to take time off for pre-placement activities such as legal consultations, court appearances, and home studies. Karen Madden Humelbaugh, director of Paid Leave Oregon, explained that the new benefit was created to support families during the adoption or fostering process.
“Pre-placement leave is designed for people who are actively in the process of adopting or fostering a new child into their home,” Humelbaugh said. “Eligible employees can take this type of leave for pre-placement activities such as counseling sessions, court appearances, legal consultations, physical examinations, home studies, and related travel.”
With the continuation of stable tax rates and an increase in the taxable wage base, Oregon employers are likely to experience another year of manageable payroll tax contributions in 2025. The state’s unemployment and paid leave programs continue to be among the most robust in the nation, ensuring support for workers while keeping costs predictable for businesses.
