March 02, 2020
Why is the Nonprofit Sector Growing At Such Fast Rates?
According to the National Center for Charitable Statistics, there are more than 1.5 million nonprofits registered in the U.S. Believe it or not, this figure keeps increasing at an exponential rate. So what’s caused the growth of the nonprofit sector in the past decade? We'll further explore the answer to this question below.
Why The Nonprofit Sector Has Grown In The Past 10 Years
While nonprofits have always been popular, they’ve grown significantly over the past 10 years. Compared to the for-profit sector, which has only grown by about 2 percent to 3 percent, the non-profit sector has gone up by 20 percent. A report by PNP Staffing Group discovered that in addition to this drastic growth, many employees are leaving the for-profit world to work at nonprofits. There are more staff increases and employee transfers today than ever before. Americans are supporting causes they believe in and dedicate their careers to them. This is exciting, as nonprofits used to have a bad reputation for offering lower salaries and demanding more work than for-profit organizations. You may be surprised to learn that nonprofits are the third largest employer in the country. They employ 11.9 million people and are right behind retail trade, which gives 15.7 million work and manufacturing, which hires 12.3 million. Nonprofits in health-related fields such as hospitals, clinics, and home services account for more than half of the nonprofit workers.Nonprofit Workforce As Compared to For-Profit Workforce
For-profit organizations strive to maximize profits for the benefit of their owners and shareholders. On the contrary, nonprofits raise money to provide for the needs of society. Rather than boosting revenue while reducing expenses, they work to ensure revenue exceeds costs. The revenue a nonprofit corporation earns will never be distributed to the owners. Instead, it'll go back to the organization’s benefit to support its mission and initiatives. In addition, unlike for-profits, nonprofits are exempt from paying taxes on their net income. The government provides them with this perk because they invest their time, resources, and funds into making the world a better place.What Has Caused This Growth?
There are numerous reasons the nonprofit sector has grown, including:- Increased Awareness
- Corporate Partnerships
- Greater Demand for Supporting Others
- Advanced Technology
- Knowledgeable Employees