The following essay was originally published in The Philadelphia Inquirer in conjunction with the Lindy Institute for Urban Innovation at Drexel University as part of Rebuilding Philly, a series of commentary articles written by professors and related Drexel professionals. to the COVID-19 pandemic and to racial and economic equity. gaps in Philadelphia. It was written by Bruce Melgary, senior researcher at the Lenfest Center for Cultural Partnerships at Drexel University.
While most of us are familiar with non-profit organizations, many people do not realize how important the sector is and the extent of its impact on the national economy and employment.
According to the National Center for Charitable Statistics at the Urban Institute, there were approximately 1.54 million nonprofits registered with the Internal Revenue Service in 2016. The actual number is larger because religious organizations including incomes below $ 5,000 are not required to register. What most of us generally think of as nonprofits are public charities which make up about 70% of the total. But the IRS defines about 30 different types of nonprofit organizations that also include social clubs, veterans associations, unions, and chambers of commerce, to name a few.
What makes a non-profit organization “non-profit” is that it does not provide financial rewards (profits) to owners or shareholders, but rather uses its resources for the benefit of its members or the public. in a significative way. According to the charity statistics center, the nonprofit sector contributed about $ 1.05 trillion to the country’s gross domestic product in 2016, or about 5.6% of the total.
The Johns Hopkins University Center for Civic Studies, in its “2019 Nonprofit Employment Report,” indicates that approximately 12.3 million people were employed by nonprofit organizations in the United States in 2016. This represented approximately 10.2 million people. % of all private jobs (15.6% in Pennsylvania) and ranks third among 18 industry sectors tracked by the federal government. Nonprofit employment was just below accommodation and food services and roughly equal to manufacturing. The three categories of education, health care and social assistance accounted for about 81% of nonprofit jobs.
Even when times are good, the nonprofit business is very demanding and competitive. Its revenue model is based on a combination of service charges, government support and public donations which can vary widely from year to year. Its workforce typically consists of a mix of volunteers and staff, with governance provided by an unpaid volunteer board of directors and management of the organization provided by paid professional staff.
Let’s imagine that we have now moved to the year 2025. What do these nonprofits that have survived and thrived since the tumultuous events of 2020 have in common that sets them apart from the rest?
They put the mission above all else and it became the “guiding light” for all board members and staff. They ensured that their missions were relevant to the people they served, and they consistently and accurately measured and evaluated their effectiveness in fulfilling those missions. They made changes when needed, deciding what to do and what not to do while being realistic about resources.
They embraced diversity at large, not for political correctness but for better results. Their boards of directors and staff have become representative of the voters served by their organizations. They went beyond “all fundraising all the time” because while fundraising is always essential, other skills, skills and life experiences matter as well. They actively sought diversity of thought because it facilitated “out of the box” ideas and better problem solving. They have engaged young people at all levels since they are the future of any organization.
They have joined in productive partnerships. They understood that working effectively with complementary organizations generally yields better results than working alone. They shared support services with other organizations so that more resources could be devoted to their missions.
They have invested in technology and dramatically increased its use to improve program efficiency and reduce administrative costs. They have found ways to combine the best people with the best technology to better fulfill their missions.
In a rapidly changing society, the role of non-profit organizations in meeting human needs will increase year by year. Let each of us think about what we can do to help nonprofits survive and thrive in 2025 and beyond.