Economic Impact of the Non-Profit Sector

The importance of non-profit organizations in our communities, as well as in our economy is sometimes underestimated. Food banks, sports teams, charter schools, museums, senior centers, research institutes, opera, job training programs, after-school programs, as well as many hospitals and colleges – are all non-profit organizations. And that means they all engage in fundraising of some kind.

If you are one of those people who fundraise for one of those important organizations –and they are all important — this column is written for you. According to the Independent Sector, a Washington, D.C.-based coalition of nonprofits that also works on policy issues, in 2009 nonprofits employed 13.5 million people, approximately 10 percent of the country’s workforce and 5.5 percent of the country’s gross domestic product. That’s a lot of people and a lot of jobs. And behind those people and jobs are fundraisers – both paid and volunteer.

Some non-profits such as hospitals and colleges have an “earned revenue stream,” comprised of fees for services or tuition. Many nonprofits depend on donated funds for or all or part of their revenue. And that includes hospitals and colleges. Employees and volunteers write funding proposals to public agencies, foundations, and corporations requesting their support. They host special events, send out letters, encourage people to give via text messaging, or using an on-line donate-now button. Some ask people in person to make a large gift. Others help families include their churches or beloved organization in their will or estate plan. Still others facilitate consumer-focused marketing ventures that bring together a non-profit and a business/ corporation that provide mutual benefits for the business, the non-profit, and the consumer. These are referred to as “cause marketing programs.”

But fundraisers don’t do it alone. Board  members play a special role in both fundraising and governing these organizations. They have a responsibility for the nonprofit’s financial health. They hire – and if necessary fire – the executive director. They oversee the organization’s fundraising. And – though many don’t want to accept this – they are responsible for making a meaningful gift to the organization and asking others to do so.

We must not forget donors and volunteers, who are at the heart of the non-profit sector, giving money, time and resources. Most of us are donors. We give to organizations we believe in, in hopes of making a difference. Last year individuals gave generously to nonprofits. Some gave $50 million. Others gave $50. Together the total, according to Giving USA, was over $211 billion.

We honor all of you, and the important economic impact you make locally and across the country. Your organization may be small, or it may be a multi-million dollar operation. What we know is that together we make a difference in providing services, enhancing lives, and sustaining our economy.

We appreciate all of you. Thanks for making a difference.

Let us know what you think.