Data shows nonprofit workforce took a nosedive during the pandemic

The nonprofit share of the total non-government workforce decreased from 10.2% in 2017 to 9.9% in 2022, reflecting losses in nearly all fields in which they are significantly active. However, the nonprofit sector’s 12.8 million workers made it the third largest employer in the U.S. non-government economy as of 2022. 

Between 2019 and 2020, when the COVID-19 pandemic began, nonprofit employment declined by 580,000, or 4.5%. Nonprofits fared better than for-profits overall, which shed nearly 7% of workers. Nonprofits faced challenges in re-staffing during 2021 and 2022, lagging for-profit counterparts. 

The nonprofit sector was left with a workforce 1.4% smaller than in 2019, while the for-profit workforce grew by 2.2%. As a result, nonprofits lost ground to for-profit counterparts in terms of market share. The nonprofit share of the total non-government workforce decreased from 10.2% in 2017 to 9.9%. 

The data is from the “2024 Nonprofit Employment Data Report” by The Center on Nonprofits, Philanthropy and Social Enterprise at George Mason University’s Schar School of Policy and Government. It is part of the George Mason University – Nonprofit Employment Data Project (GMU-NED). 

The report is an initial look at new data on nonprofit employment and wages covering the period 2018-2022 that have been generated by the U.S. Bureau of Labor Statistics (BLS) from the Quarterly Census of Employment and Wages (QCEW). Researchers examined where nonprofit employment and wages stood in the immediate pre-COVID years, how they were impacted by the onset of the COVID-19 pandemic, and how they have recovered as of 2022, the latest year for which data are available. 

“Overall, as detailed in the report, as of 2022, nonprofits had restored nearly 70% of the more than half-million workforce losses they suffered in 2020,” Alan Abramson, Ph.D., and director of the Center on Nonprofits, Philanthropy, and Social Enterprise, said in a news release. “But that left significant ground for nonprofits to make up to get back to the employment levels they enjoyed in 2019 in several key fields, and even further to go to catch up to where the sector’s workforce would have been without these losses.” 

Nonprofits continued to pay roughly similar average annual wages as for-profits overall during 2022 — 97.2% versus the 96.7% paid in 2017. In several key fields, nonprofit average annual wages continued to surpass those paid by for-profit counterparts by significant margins, with social assistance nonprofits paying 52.8% more (a 3% drop vs. 2017) than for-profits in the same field; educational services nonprofits paying 42.3% more (a drop of 7.3%) than for-profit institutions; and health care nonprofits paying 12% more than for-profit health care providers (an increase of 3% vs. 2017). 

There were sectors that didn’t do as well. Religious, grantmaking, civic, professional and similar nonprofits continued to pay nearly 18% less on average than their for-profit counterparts in 2022, this was an improvement of 5.4% compared to 2017. Arts, entertainment and recreation nonprofits lost ground by 2.6% vs. their for-profit counterparts.