Unemployment expenses can present significant obstacles for nonprofits in New Jersey. Here are some key considerations that reveal the impact of some hidden costs:
1:) Loan Interest:
The New Jersey Department of Labor (NJDOL) has temporarily paid off a federal government loan to replenish its unemployment fund, but the reprieve is only temporary. NJDOL anticipates that it will be carrying a balance until May 2024. The loan will eventually cost employers $19.8 million.
2.) Overpayment Issues:
Throughout 2022, New Jersey overpaid approximately 20% of unemployment benefits, resulting in an alarming total of over $355 million. This highlights the inefficiencies within the system that can have a significant financial impact. Considering the average claim in NJ is $9,359, overpayments can cost up to $1,872 per claim!
3.) Magnitude of Unemployment Benefits:
It may come as a surprise, but an unemployment claimant in New Jersey can collect up to $830 per week. When calculated over the maximum 26-week period, a single standard claim can accumulate a substantial sum of $21,580. This underscores the potential financial strain on the unemployment system and its potential consequences for nonprofits.
Don’t let hidden unemployment costs hinder your nonprofit’s progress. Partner with FNP, a game-changer for 501(c)(3) organizations. With FNP, you can save up to 60% on unemployment taxes and significantly reduce claim liability through comprehensive audits of all unemployment charges. By diverting unnecessary expenses, you can channel more resources toward your mission and make a lasting impact in your community.
Michael Fleischer, Senior Vice President
SterlingRisk Insurance
Phone: 516-719-8759
Email: [email protected]