2025 Unemployment Rates Are In: Why Reviewing Them Now Matters
As 2025 begins, nonprofits across the country are receivingtheir updated unemployment tax rates. This number may seem like just anotherline item in the budget, but nonprofits must understand thatthese rates can significantly impact their financial health—and now is theperfect time to review and take control of these costs.
The Importance of Reviewing Unemployment Costs
Unemployment tax rates can fluctuate yearly due to factorslike state unemployment trust fund solvency, organizational claims history, andindustry trends. For health centers, which often operate on tight budgets and relyheavily on Federal contributions, even a slight increase in unemployment costscan divert funds away from core programs and services.
By reviewing your unemployment costs early in the year, youcan identify opportunities to reduce expenses, forecast more accurately, andensure compliance with state and federal regulations.
Key Reasons to Review Now
Understand Your New Rates
State agencies typically send updated unemployment tax ratesat the start of the year. Reviewing these rates allows you to understand howyour costs may change and assess their impact on your overall budget.
Evaluate Your Claims History
Your tax rate might have increased if your organization experienced higher-than-usual unemployment claims over the past year.Analyzing your claims history can help you identify patterns and take steps tomitigate future claims.
Explore Cost-Saving Alternatives
Nonprofits have unique options when it comes to unemploymentcoverage. Many are unaware they can opt out of the state’s unemployment taxsystem and become reimbursing employers, paying only for actual claims ratherthan a percentage of payroll. Organizations that partner with First Nonprofit,for example, often see significant savings through tailored unemploymentsolutions.
Plan Proactively
Early review allows you to adjust your financial plans,implement strategies to minimize future claims, and ensure you make themost of available resources. This proactive approach can help your nonprofitstay ahead of potential financial challenges.
How to Get Started
- Locate Your Rate Notice: Contact your stateunemployment agency if you haven’t received your 2025 unemployment rate notice.
- Assess Your Options: Compare your current costs under the state tax system to potential savings as a reimbursing employer. First Nonprofit’s team of experts can provide a no-obligation analysis to help you make an informed decision.
- Train Your Team: Equip your HR and finance teams with the knowledge to manage claims effectively and minimize unnecessary costs.
The Bottom Line
Community health centers have a mission to serve their communities, but managing operational costs is key to ensuring long-term sustainability. Reviewing your unemployment costs can uncover savings opportunities and provide greater financial stability for the year ahead.
If you’re ready to take control of your unemployment expenses, First Nonprofit and CHCollective are here to help. Contact First Nonprofit today to learn more about how they can support your mission through cost-effective unemployment solutions.