March 12, 2013

Nonprofits a Vital Part of Many Nations’ Economies, Study Finds

Nonprofits are a significant and growing source of jobs and economic activity worldwide, according to a new study from the Johns Hopkins University Center for Civil Society Studies.

The study found that if both paid staff members and volunteers are counted, nonprofits account for 7.4 percent of the total work force, on average, in 13 nations for which data were available. That was a bigger share than other major industries including finance and transportation.

What’s more, nonprofits are growing so quickly that their economic activity is outpacing that of overall growth in many of the nations studied.

Charities’ contributions to gross domestic product increased at an average rate of 5.8 percent a year from the mid-1990s to the mid-2000s, the study found. That compares with a 5.2-percent overall growth rate in the eight countries for which data was available.

The study also found that nonprofits:

  • Account for 4.5 percent of gross domestic product in 15 countries studied if both paid work and volunteer time are counted.
  • Received more of their revenue from fees for services (43 percent) than from governments (32 percent) and private donations (23 percent).
  • Account for more than 11 percent of the total work force in two countries, Belgium and Israel.
  • Contributed the greatest share of economic activity in Canada and Israel.