Employment in U.S. Nonprofits Outpaces Overall Job Growth

Employment in U.S. Nonprofits Outpaces Overall Job Growth

Increases are in all regions of the country; total work force passes 14 million

By Mimi Bilzor
Institute for Policy Studies

Employment in the U.S. nonprofit sector has grown faster than overall employment in 46 of the 50 states, according to a new report by the Nonprofit Employment Data Project at the Johns Hopkins Center for Civil Society Studies.

As of the second quarter of 2004, the latest year for which data on nonprofit employment are available, American charities employed 9.4 million paid workers and engaged another 4.7 million full-time equivalent volunteer workers for a total work force of more than 14 million workers.

Between 2002 and 2004, the nonprofit work force grew by 5.3 percent, with both the paid and volunteer portions growing by more than 5 percent. By contrast, overall employment in the economy declined by 0.2 percent during this period.

"The nonprofit work force, including volunteers, now represents 10.5 percent of the country's total work force," said Lester M. Salamon, director of the Center for Civil Society Studies within the Johns Hopkins Institute for Policy Studies and a leading expert on nonprofits. "Put in perspective, this means that American charities boast a larger work force than the utility, wholesale trade and construction industries combined."

Other findings of the report include the following:

The nonprofit share of the total work force is especially high in the Northeast and Midwest, where it ranges from 10.7 to more than 14 percent. In the South and West, the nonprofit work force accounts for a considerable 8.1 percent to 9.5 percent of the total work force.

Nonprofit-paid workers received $321.6 billion in wages in 2004, more than the wages paid by the utility ($50.1 billion), wholesale trade ($283.7 billion) and construction ($276 billion) industries, and almost as much as by the finance and insurance industry ($355.8 billion).

Charitable nonprofit employment is scattered across a wide variety of fields, from information and scientific services to religious and civic associations. The bulk of this employment, however, is in human services, with hospitals accounting for one-third of all nonprofit employment and other health providers, such as clinics and nursing homes, accounting for another 21 percent.

The average weekly wage in the nonprofit sector, at $627, was well below the $669 average in the for-profit sector. However, in the fields where nonprofits and for-profits are both actively engaged, average nonprofit wages were actually higher. For example, average wages among nonprofit hospital workers were 7 percent higher than those of for-profit hospital workers, and average wages among nonprofit social assistance workers were 25 percent higher than those of their for-profit counterparts.

The private nonprofit sector comprises private universities, schools, hospitals, clinics, day-care centers, social service providers, symphonies, museums, art galleries, theaters, environmental organizations and many others eligible for tax exemption under Section 501(c)(3) of the Internal Revenue Code.

The Nonprofit Employment Data Project at the Johns Hopkins Center for Civil Society Studies seeks to quantify the size and scope of nonprofit employment throughout the United States. The data in this report draw on the Quarterly Census of Employment and Wages, assembled by the U.S. Bureau of Labor Statistics, and on the special tabulation on voluntary work conducted as part of the Census Bureau's Current Population Survey.

To view the entire report, including a state-by-state breakdown of nonprofit employment, go to www.jhu.edu/ccss/research/bulletins.htm.