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Tax rate for new employers

The tax rate for employers who have not had employees long enough to be assigned an experience rating (new employer) is based on the average rate for the employer’s industry. This ensures that new employers have a rate that aligns with other businesses in their industry.

Industries are defined by the North American Industry Classification System (NAICS). The NAICS groups industries together and assigns them a five digit code. Reading from left to right, the NAICS "drills down" from broadly defined industry groups to very specific industries. To learn more about NAICS, visit the Introduction to NAICS page on the United States Census Bureau website.

When an employer registers for an unemployment insurance account, we ask what industry they are in and assign their new employer rate accordingly. We group together new employer rates for non-construction industries to the first two digits of the NAICS code. For construction industry employers, we use all five digits of the NAICS code.

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