Nonprofit Sector is Growing Faster than Rest of the Economy

Abstract

Even during and after the recession, from 2007 to 2010, nonprofit employment grew 4 percent and wages increased 6.5 percent, while they decreased in the business sector by 8.4 percent and 8 percent, respectively, and increased only 1 percent and 4.8 percent, respectively, for government. However, in 8 of the past 10 years, the nonprofit sector spent more than it earned. The gap between revenues and outlays was $65 billion in 2008, 2009, and 2010.

Contact:Simona Combi, (202) 261-5709, scombi@urban.org

WASHINGTON, D.C., November 1, 2012—The nonprofit sector's growth in total wages and employees outpaced government and business between 2000 and 2010, The Nonprofit Almanac 2012 shows. The volume was published this week by the Urban Institute Press.

Even during and after the recession, from 2007 to 2010, nonprofit employment grew 4 percent and wages increased 6.5 percent, while they decreased in the business sector by 8.4 and 8 percent, respectively, and increased only 1 and 4.8 percent, respectively, for government.

Nonprofits paid $587.7 billion in wages and employed 13.7 million people (9 percent of the country's labor force) in 2010.

Nonprofit organizations did not escape the recession unscathed. Private giving was down 11 percent from 2007 to 2010. While corporate giving dropped 13 percent between 2007 and 2008, by 2010 it had surpassed pre-recession levels.

However, in 8 of the past 10 years, the nonprofit sector spent more than it earned. The gap between revenues and outlays was $65 billion in 2008, 2009, and 2010.

"The growth trends should not mask the cutbacks and hardships that nonprofits, especially small ones, have experienced these past few years. Some closed their doors during the recession; others cut staff, wages, or activities to stay afloat. Still, the nonprofit sector continues to show its resilience and has become a larger part of the U.S. economy since 2008," says Thomas Pollak, director of the Institute's National Center for Charitable Statistics.

The Nonprofit Almanac 2012, by Katie Roeger, Amy Blackwood, and Sarah Pettijohn, explores the sector in detail, particularly its role in the economy. Chapters 1-4 offer data on wage and employment trends, financial trends, and giving and volunteering between 2000 and 2010 (for which the latest complete data are available). Chapter 5 focuses on the size, scope, and finances of 501 (c)(3) public charities and is summarized in "The Nonprofit Sector in Brief: Public Charities, Giving, and Volunteering, 2012."

The Almanac shows that

• An estimated 2.3 million nonprofit organizations operated in the United States in 2010. Some 1.6 million nonprofits were registered with the Internal Revenue Service (IRS), an increase of 24 percent from 2000. Of these, only 40 percent (about 618,000) were required to file a financial return with the IRS because they collected more than $50,000 in gross receipts in 2010.
• 958,740 public charities were registered in 2012, nearly two-thirds of all registered nonprofits. They include arts, education, health care, human services, and other types of organizations to which donors can make tax-deductible donations. The number of registered public charities grew 42 percent over the decade, faster than other types of nonprofits.
• The nonprofit sector contributed $804.8 billion to the U.S. economy in 2010, 5.5 percent of the gross domestic product.
• In 2011, private charitable contributions, which include giving to public charities and religious congregations, totaled $298.4 billion.
• In 2011, 26.8 percent of adults volunteered with a nonprofit. Volunteers contributed 15.2 billion hours, worth an estimated $296.2 billion.
• The Nonprofit Almanac 2012 is available from the Urban Institute Press in paperback (ISBN 978-0-87766-773-5, 272 pages, $49.50) and ePub (ISBN 978-0-87766-774-2, $26.99). Each chapter, bundled with the foreword, glossary, list of sources, and index, is available as a separate ePub for $12.99. Order online at http://www.uipress.org, call 410-516-6956, or dial 1-800-537-5487 toll-free. Read more at http://www.urban.org/books/nonprofit-almanac-2012/.

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