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Nonprofits Set to Grow Again in 2015 – But Can They Compete? by Marty Davis

Looking at the last decade, the nonprofit sector have outperformed for-profit businesses in terms of job creation. Even though nonprofits took a big hit during the economic downturn, they bounced back strongly and, from 2000 to 2010 expanded by just over 2%; over the same time, for-profits contracted by around 0.6%. Today, there are around two million nonprofits in the US, employing about 11 million people.

This year, according to a survey, of 362 US and Canadian businesses, by Washington consultancy firm Nonprofit HR, around half of nonprofits are expecting to recruit more staff, with only 36% of for-profit businesses set to do the same. What’s more, nearly three-quarters of profit-making firms are planning to shed staff, compared to 7% of nonprofits (with a further 7% expecting to freeze recruitments).

Now, the big question is: how easy is it going to be to fill those new positions, many of them vital technology and data processing roles? Not only do nonprofits tend to lack the recruitment budgets of the for-profit sector, they are also unable to compete on a salary level. Also included in the figures from Nonprofit HR were stats on employee attrition, with 27% of respondents citing this as the number one reason behind staff leaving. So although there will be less jobs around in the corporate sector, those that do exist are likely to be higher paid and more conspicuously advertized.

However, for those employees not put off by lower wages – perhaps those looking to support a cause, earn some prestige or, simply, have a change, the social benefit sector is likely to be creating the most positions. But for those looking to join a faith-based nonprofit, there could be disappointment as that sector are featured heavily in the ‘planning to downsize’ camp.

Whether you’re a profit or nonprofit and whether you plan to recruit or downsize, Legal Solutions Group provide business consultancy as well as legal services and assistance with corporate law compliance.

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One Comment

  1. Bill says:

    One reason this qsioteun continues to be debated, I think, is because there is not a one-size-fits-all answer. A new or small non-profit, maybe even one that has a very narrow niche, may need only those who donate their time and expertise. An example that comes to mind that I am familiar with is a youth summer-stock theater group. The strongest argument in my mind for requiring a give-or-get dollar amount for board membership is when the board is active in raising financial support. It is easier to ask someone to support a mission which you have already committed your own money to. Personally, I would trade a member fully committed and passionate about the mission over one who has made a financial contribution any day. The key is finding those unique individuals. Should you find one who can be on fire about the work and give financial support, that is a real win. The rest have to be nurtured.

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