Workers’ comp isn’t priced per head. It’s priced per $100 of payroll, at a rate set for each job classification, so the cost of one employee is their wages ÷ 100 × the rate for their class. That’s why the honest answer to “how much per employee?” is a range — and why comparing states needs a common yardstick.
The yardstick most people use is Oregon’s premium rate ranking, published every two years by the Oregon Department of Consumer and Business Services. It applies each state’s rates to the same 50 job classes, weighted by Oregon’s payroll mix, so differences reflect the states rather than their industries. The latest edition uses rates in effect January 1, 2024; the national median was $1.09 per $100 of payroll.
The Formula, With One Employee
| Step | Example (Illinois index, $50,000 employee) |
|---|---|
| Payroll ÷ 100 | $50,000 ÷ 100 = 500 |
| × rate per $100 | 500 × $1.34 = $670 a year |
| × your experience mod | × 0.90 = $603 (better-than-average claims) |
| × schedule credit or debit | × 0.95 = $573 (5% credit) |
| Per month | about $48 |
Illustrative. Real policies also add a minimum premium, expense constant, and state taxes and assessments.
Cost per Employee in Every State
| Rank | State | Index per $100 payroll | % of median | Per year, $50,000 employee | Per month |
|---|---|---|---|---|---|
| 1 | Hawaii | $2.52 | 231% | $1,260 | $105 |
| 2 | New Jersey | $2.16 | 198% | $1,080 | $90 |
| 3 | New York | $1.98 | 182% | $990 | $82 |
| 4 | California | $1.86 | 170% | $930 | $78 |
| 5 | Vermont | $1.60 | 147% | $800 | $67 |
| 6 | Connecticut | $1.48 | 135% | $740 | $62 |
| 7 | Wisconsin | $1.42 | 130% | $710 | $59 |
| 8 | Wyoming | $1.41 | 130% | $705 | $59 |
| 9 | Louisiana | $1.41 | 129% | $705 | $59 |
| 10 | Rhode Island | $1.38 | 127% | $690 | $58 |
| 11 | Maine | $1.37 | 125% | $685 | $57 |
| 12 | Washington | $1.35 | 123% | $675 | $56 |
| 13 | Illinois | $1.34 | 123% | $670 | $56 |
| 14 | Montana | $1.34 | 122% | $670 | $56 |
| 15 | Oklahoma | $1.33 | 122% | $665 | $55 |
| 16 | Missouri | $1.31 | 120% | $655 | $55 |
| 17 | Minnesota | $1.25 | 114% | $625 | $52 |
| 18 | New Hampshire | $1.22 | 112% | $610 | $51 |
| 19 | Iowa | $1.21 | 110% | $605 | $50 |
| 20 | Alaska | $1.16 | 106% | $580 | $48 |
| 21 | Pennsylvania | $1.14 | 105% | $570 | $48 |
| 22 | South Dakota | $1.13 | 103% | $565 | $47 |
| 23 | Nebraska | $1.12 | 103% | $560 | $47 |
| 24 | Alabama | $1.11 | 101% | $555 | $46 |
| 25 | Idaho | $1.10 | 101% | $550 | $46 |
| 26 | Georgia | $1.09 | 100% | $545 | $45 |
| 27 | New Mexico | $1.05 | 96% | $525 | $44 |
| 28 | Colorado | $1.05 | 96% | $525 | $44 |
| 29 | South Carolina | $1.03 | 94% | $515 | $43 |
| 30 | Florida | $1.00 | 92% | $500 | $42 |
| 31 | Massachusetts | $0.97 | 89% | $485 | $40 |
| 32 | Delaware | $0.97 | 89% | $485 | $40 |
| 33 | North Carolina | $0.95 | 87% | $475 | $40 |
| 34 | Mississippi | $0.94 | 86% | $470 | $39 |
| 35 | Kansas | $0.91 | 83% | $455 | $38 |
| 36 | Michigan | $0.90 | 82% | $450 | $38 |
| 37 | Maryland | $0.89 | 82% | $445 | $37 |
| 38 | Oregon | $0.89 | 82% | $445 | $37 |
| 39 | Tennessee | $0.80 | 73% | $400 | $33 |
| 40 | Texas | $0.78 | 72% | $390 | $32 |
| 41 | Kentucky | $0.76 | 70% | $380 | $32 |
| 42 | Nevada | $0.73 | 67% | $365 | $30 |
| 43 | District of Columbia | $0.73 | 67% | $365 | $30 |
| 44 | Virginia | $0.73 | 67% | $365 | $30 |
| 45 | Indiana | $0.71 | 65% | $355 | $30 |
| 46 | Arizona | $0.70 | 64% | $350 | $29 |
| 47 | Ohio | $0.68 | 63% | $340 | $28 |
| 48 | Utah | $0.63 | 57% | $315 | $26 |
| 49 | West Virginia | $0.54 | 49% | $270 | $22 |
| 50 | Arkansas | $0.53 | 48% | $265 | $22 |
| 51 | North Dakota | $0.50 | 45% | $250 | $21 |
Source: Oregon Department of Consumer and Business Services, 2024 Oregon Workers’ Compensation Premium Rate Ranking (rates as of January 1, 2024; rank 1 = most expensive). Index excludes experience rating, discounts and dividends. Ohio, North Dakota, Washington and Wyoming are state-fund-only states; Washington’s hourly rates are converted for comparison.
Why Your Number Will Be Different
- Job classification moves cost the most. The index averages 50 classes. Clerical office work is usually a small fraction of the index rate in the same state, while roofing, tree work and other high-hazard trades can run many times higher. Two businesses in the same state can differ by a factor of twenty per employee.
- Experience mod. A mod of 0.80 cuts the bill by about 20%; a mod of 1.40 adds about 40%. Our EMR calculator shows how claims move it.
- Schedule rating. Insurers can add a credit or debit of up to about 25% for safety programs, workplace condition and management — see how schedule rating works.
- Owners. Covered owners are counted at state minimum or maximum payroll figures, not their actual pay — see owner and officer payroll limits.
- Minimum premiums and fees. Very small payrolls often pay a carrier minimum premium, plus an expense constant and state assessments, so a one-employee business can pay more than the per-employee math suggests.
- Rates have changed since the study. Most states have filed further decreases since January 2024, so current rates in many states are lower than the index.
Rules of Thumb by State Group
Using the 2024 index, a $50,000 employee in an average-cost job costs roughly $250 to $500 a year in the least expensive third of states (such as North Dakota, Arkansas, West Virginia, Utah, Ohio and Arizona), $500 to $650 in the middle, and $650 to more than $1,200 in the most expensive (led by Hawaii, New Jersey, New York and California). For a quick estimate with your own payroll and class, use the workers’ comp calculator; each state guide in the table explains who must carry coverage there and what injured workers are paid.
Frequently Asked Questions
How much does workers' comp cost per employee?
It depends on the state and the job. Using Oregon's 2024 premium rate study, the national median was $1.09 per $100 of payroll, so an average-risk employee earning $50,000 costs about $545 a year before experience mods and discounts. Clerical jobs cost far less and high-hazard trades far more.
Which state has the most expensive workers' comp?
In Oregon's 2024 ranking, Hawaii was the most expensive at $2.52 per $100 of payroll, followed by New Jersey ($2.16), New York ($1.98) and California ($1.86).
Which state has the cheapest workers' comp?
North Dakota had the lowest index in Oregon's 2024 ranking at $0.50 per $100 of payroll, followed by Arkansas ($0.53), West Virginia ($0.54) and Utah ($0.63).
How is workers' comp cost calculated for an employee?
Divide the employee's annual payroll by 100 and multiply by the rate for their job classification, then apply your experience modification factor and any schedule credit or debit. Minimum premiums, expense constants and state assessments are added on top.
Is workers' comp a percentage of payroll?
Effectively, yes. Rates are quoted per $100 of payroll, so a rate of $1.34 per $100 is 1.34% of that employee's wages before adjustments. The rate depends on the job classification, not the business as a whole.
This content is for informational purposes only and does not constitute insurance advice. Index rates come from the Oregon Department of Consumer and Business Services 2024 premium rate ranking and reflect rates in effect January 1, 2024; actual premiums depend on classification, experience rating, carrier pricing and later rate changes. Get a quote for your own payroll and classes.