The Johns Hopkins Non-Profit Economic Data Project recently released new data on the the non-profit sector of the economy.
The data is for 2016 (the most recent available) and was developed in conjunction with the U.S. BLS (click here to go the BLS's non-profit data landing page).
The quick summary is:
- The non-profit sector is big. It employs about 10% of America's private workforce, making it the 3rd largest industry sector in America.
- The non-profit sector is growing. Between 2007 and 2016, nonprofit employment grew by nearly 17% while for-profit employment grew by less than 5%.
- Most non-profits are small businesses. Over 80% of all non-profits spend less than $1 million per year in total expenditures.
As the Johns Hopkins chart below (click to enlarge) shows, the non-profit sector also has the 3rd largest payroll of the major employment sectors.
We've long forecast that the non-profit sector would out grow the for-profit sector of the economy. We continue to forecast this. The trends driving this growth include:
- The Internet and other technology makes is making it easier to start and operate a non-profit and especially small non-profits.
- Baby boomers, looking for encore careers and a way to give back, are starting growing numbers of non-profits.
- Millennials, who have a strong interest in social service, are starting non-profits.
- Non-profits and social service organizations are in many cases replacing governments as the key solvers of social problems.
- Revenue generating business models have become more common, which is leading to more self-sustaining non-profits.
Despite the size and growth of this sector, it's are often overlooked by companies serving small businesses.
It shouldn't be.
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