Nonprofits at a Glance
January 31, 2018
Last week I wrote about the benefits of choosing a career with purpose. As a follow-up to last week’s post on choosing a career with purpose, I thought I would share some interesting statistics about the nonprofit sector. According to the Urban Institute’s Nonprofit Sector in Brief, the nonprofit sector accounts for 5.4% of the US GDP, there was a 2.8% increase in the number of nonprofits from 2003 to 2013, and in 2014 donations from foundations, businesses, and individuals totaled $358.38 billion, which represents a 5% increase over the previous year.
Nonprofit organizations fall into eight basic categories:
Arts, culture, and humanities
Environment and animals
International and foreign affairs
Public and social benefit
The Urban Institute notes human services represents the largest segment of all public charities at 35.5%, with education following at 17.1%, and health at 12.9%.
My point is that charitable organizations are not just opportunities to find purpose in one’s career or to provide much needed services to those in need. These nonprofit organizations and the monies they raise and spend have a significant impact on our country’s overall GDP. According to Bureau of Economic Statistics, as a means of comparison, the wholesale trade accounts for 5.9% and the retail trade 5.7% of the GDP. The Charitable Sector reports 10% of the American workforce is employed by nonprofit institutions.
While some might say nonprofit organizations have a long way to go to compete with their for-profit counterparts, they have come a long way in the last 10 years. The C-Suite is being paid better and more in line with for-profit executive salary practices, such as paying a base salary plus a bonus based on the financial success of the entity. Nonprofit organizations will never have the ability to pay the types of salaries Google, VISA, or Microsoft pay, but there is a trend to pay people more, but according to Charitable Advisors, US nonprofit workers saw a 3.0 salary increase in 2014 compared to a 3.5% increase for people who worked for for-profit companies. This suggests nonprofits, while they will always pay less, are working to better align with their corporate counterparts.
If we look at the nonprofit world as an industry, like manufacturing or tech, all industries have cycles of change, growth, and even decline. Prior to the arrival of the Millennial generation, nonprofits made some strides in growth, but focused more on survival. As Millennial’s entered the workforce, nonprofits have experienced record growth – according to the 501cTrust, 20% in the last ten years. I believe this growth will continue, and they will experience change beginning with the new tax laws.
Anne Converse Willkomm
Assistant Clinical Professor
Department Head of Graduate Studies
Urban Charities ~ Nonprofit Sector Brief
Charitable Advisors - 2016 Salary Survey