America’s Nonprofit Sector Is Seeing Massive Growth

by | May 15, 2023 | President's Blog

Over the past 15 years, nonprofit employment has grown 33 percent, dwarfing the 9 percent job growth enjoyed by the for-profit private sector over that time. Nonprofits have passed local government to become the second-largest source of employment in the country, behind the for-profit sector.

The top five states for nonprofit employment are all in the Northeast, with Vermont leading a New England sweep of the podium, along with Maine and Massachusetts. Pennsylvania and Rhode Island round out the top five. (D.C., that inveterate outlier, would beat out every state for first place — but it may not be fair to compare a dense urban core that is also the nation’s capital with the sprawl of your average American state.

At the bottom of the rankings are Texas, that bastion of privatization, self-reliant Nevada, and the storm-battered territory of Puerto Rico.

Women are about twice as likely to work at nonprofits as their male peers, and nonprofits have the smallest wage gaps of any sector. The typical woman at a nonprofit makes about 88 percent as much each hour as her male counterpart, a huge improvement over the 80 percent she’d earn in the for-profit sector, and effectively tied with the 87 percent she’d make in the federal government.

As a rule, the more educated and older you are, the more likely you are to have a nonprofit job. Having an advanced degree makes you three times likelier to do nonprofit work than your friends who didn’t make it past high school.

That’s partly because medicine has swallowed much of the nonprofit sector. When you think of nonprofits, you think of scrappy do-gooders running on donations. But 1 in every 5 nonprofit jobs is in hospitals, and 1 in 3 is in the health sector more broadly. About 2 in 5 hospital jobs in the entire country are in nonprofits. Nonprofit hospitals employ more than twice as many people as colleges, private schools, or religious organizations — the next largest nonprofit industries.

The South’s lack of nonprofits largely reflects a lack of nonprofit medicine. Other types of nonprofits tend to be more equitably distributed. As readers, Tim Carter in Seattle and Joe Bogucki in Newnan, Ga., pointed out when we looked into credit scores, the South’s surfeit of for-profit hospitals might be another reason that region has such high medical debt.

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