guidestarblog_header.png

Nonprofit Rate of Job Growth Outpaces For-profit Rate by Over 3-1 Over Last Decade

Data just released by the U.S. Department of Labor’s Bureau of Labor Statistics using a technique first developed by the Johns Hopkins Center for Civil Society Studies shows that the nonprofit sector continued its steady record of significant job growth through 2016, the latest date for which data are available, outpacing the rate of for-profit job growth by over 3 to 1.

Between the pre-recession year of 2007 and 2016, nonprofit employment grew by nearly 17% while for-profit employment grew by less than 5%.

This pattern was quite widespread, moreover, with the nonprofit employment growth rate over the recent decade exceeding that of for-profit firms in 49 of our country’s 50 states, as well as in DC and Puerto Rico. The only exception was North Dakota, where the two sectors were tied.

This development builds on an existing, substantial nonprofit workforce. In fact, nonprofit organizations are the third largest private workforce of all U.S. industries, behind only retail trade and manufacturing.

Reflecting this, nonprofits also account for the third largest employee payroll, with total nonprofit wages exceeding those of most other U.S. industries, such as construction, transportation, and finance.

Nonprofits are major generators of income in a wide array of states, moreover. Indeed, nonprofit total wages exceed those generated by manufacturing in nearly half of the U.S. states.

“The substantial sizes of the nonprofit payroll and workforce, are a byproduct of demographic shifts and the changing structure of the U.S. economy, with service fields growing most rapidly and nonprofits heavily involved in some of the most important of them, including health, education, and social services,” noted Lester Salamon, Director of the Johns Hopkins Center for Civil Society Studies.

Indeed, nonprofits account for over 90% of employment in U.S. private higher education institutions, 84% of employment in private hospitals, and 42% of employment in private social assistance organizations.

Recent shifts in national policy have disadvantaged nonprofits in a number of pivotal fields, however. This shows up vividly in the 2016 data, which reveal declines in the nonprofit share of employment between 2012 and 2016 in a number of major fields, including social assistance, hospital care, and nursing and residential care.

“Unfortunately, policymakers both nationally and locally have been slow to recognize the special contribution nonprofits make to America’s economy and human service delivery system,” Salamon added. “Hopefully, these data will help change this.”

This latest update on nonprofit employment and wages was made possible through the support of the Johns Hopkins University and its Center for Civil Society Studies with grant funding from the Charles Stewart Mott Foundation. The full 2016 BLS nonprofit data file can be downloaded here.

A fuller analysis of the 2016 BLS data will be available from the Johns Hopkins Center for Civil Society Studies shortly and will be available at ccss.jhu.edu. The 2016 data—including county level data—will be available through the Center’s Nonprofit Works: An Interactive Database of on the Nonprofit Economy in September 2018.

This post is an August 28, 2018, press release issued by the Johns Hopkins Center for Civil Society Studies, a leading source of ground-breaking research and knowledge about the nonprofit sector, social investing, and the tools of government. Working in collaboration with governments, international organizations, investment innovators, and colleagues around the world, the Center encourages the use of this knowledge to strengthen and mobilize the capabilities and resources of the public, nonprofit, and for-profit sectors to address the complex problems that face the world today. The Center conducts research and educational programs that seek to improve current understanding, analyze emerging trends, and promote promising innovations in the ways that government, civil society, and business can collaborate to address social and environmental challenges.

About the Johns Hopkins Nonprofit Economic Data Project (NED)

Nonprofit organizations are facing increased pressures in states and localities throughout the United States, but the nonprofit sector’s ability to respond to these pressures has been limited by a lack of timely information about how prevailing economic realities are affecting the sector. The Johns Hopkins Nonprofit Economic Data Project (NED) is helping to tackle this problem by charting economic trends in the nonprofit sector including how employment, wages, and finances have changed over time and in relation to other industries. Moreover, the project is able to analyze these data at the national, regional, state, and local levels, and to focus on particular subsectors—such as nursing homes, hospitals, home health centers, education, social services, and the arts. A collaboration between the Johns Hopkins Center for Civil Society Studies, state employment security agencies, the U.S. Bureau of Labor Statistics, and state nonprofit associations, the NED Project has thus far produced over 40 state, county, and regional Nonprofit Economic Data Bulletins since its founding in 2001, yielding a vital resource for understanding the nonprofit sector.

 Don't miss out on donations this Giving Season. Add a Donate button to your GuideStar Nonprofit Profile today.