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For October, 2012

US nonprofit sector is a job creator

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October 24, 2012
Jerry Lindman, JD

This article in CNN.com (Look to nonprofit sector to create jobs, CNN Oct 19, 2012) makes the case for the resilient job creating ability of the US nonprofit sector over the last decade, even in this slow-growth economy. Though not a surprise to some (including our LTU graduate nonprofit students), many are still unaware of the dramatic growth in the nonprofit sector and the employment opportunities that exist.  Here are some key points the author makes:

  • “the nonprofit sector employs about one in 10 American workers…..the third largest labor force behind retail trade and manufacturing.”
  • “According to a recent study the U.S. nonprofit sector posted a remarkable 10 year record of job growth despite
  • two recessions, achieving an annual growth rate of 2.1% from 2000 to 2010…..for-profit jobs declined by 0.6% per year during the same period.”
  • The same study showed that “even during the recession from 2007 to 2009, nonprofit jobs increased by an average of 1.9% per year. At the same time, businesses averaged jobs losses of 3.7% per year.”
  • “While nonprofits are known for employing social workers, they also need managers, human resource professionals, educators, artists, computer programmers, marketers, accountants…researchers…and many skilled workers.”

This author closes by calling of the next President (and Congress?) to do five things to support nonprofit job growth: (1) maintain tax deductions for donations and on estate tax; (2) incentivize nonprofit education and careers; (3) expand national service via the proposed ‘Serve America Act’ (4) Invest in social entrepreneurship to promote innovation in the nonprofit sector and (5) expand tax incentives for financing of small business to nonprofits.

From my work with nonprofit organizations and their leaders, growth is just one of the major forces causing transformation of how charitable organizations operate. Because of these dynamic times, what is most needed are newly educated and trained nonprofit managers who can blend the unique nonprofit management competencies with new business-influenced strategies that support diversification of their revenue sources to include more earned income. Coincidentally, that is the topic my students are addressing this week in my graduate course in nonprofit management.

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