4 Reasons to Consider Careers in the Not-for-profit Sector:  Earn a living and serve your community, too!

Back in the 1980s, I went to graduate business school while working at a government job. The plan was to move on with the fancy degree to make lots of money at a big company.

The plan did not work for many reasons. Among other things, toiling for someone else’s bottom line did not seem interesting after learning more about business. And, after speaking with entrepreneurs in my classes and elsewhere, starting my own business did not look appealing at that time either.

Fortunately, when my government career ended, I discovered a third option—working at a not-for-profit organization.

Not-for-profit organizations employ nearly one-tenth of America’s workers. They range in size from small volunteer-operated social service programs to world-renown medical centers and universities. Nonprofits need employees to perform many of the same functions they would perform in profit-making businesses. Universities, for example, often have large custodial maintenance teams, as well as accounting, compliance, finance, and legal departments, to name just a few.

So, there are some good reasons to include not-for-profit organizations in your job search or career planning. Here are just a few, based on current research and a discussion with a CEO who has broad experience in the field:

1. Nonprofit employment represents about 10% of the nongovernmental job market,
2. These entities may employ more workers than their profit-making counterparts,
3. Excellent benefits may be available, and
4. The work environment does not focus on producing products to make money.

First, we’ll look at statistics on the not-for-profit labor force. Then, we’ll share the perspective of an experienced nonprofit executive.

Statistics

The US Department of Labor’s (DOL), Bureau of Labor Statistics (BLS) began specifically tracking the not-for-profit sector in 2007. They update their data about every five years. The most recent data on their Website was for 2022. Prior to that, BLS published data for 2017. While the data is not as recent as we might like, it gives us a good feel for the size and scope of employment opportunities.

According to a recent press release “in 2022, over 300,000 nonprofit establishments accounted for 12.8 million jobs, or 9.9 percent of all private-sector jobs.” (Employment in nonprofit organizations was about 1.4% below its pre-pandemic level, according to BLS.)

The Bureau goes on to say that “nearly 2 out of every 3 nonprofit jobs in 2022 were in the health care and social assistance sector… Other sectors with high shares of nonprofit employment included educational services…, other services…, and arts, entertainment, and recreation.”  We’ve summarized their 2022 data below. Detailed Excel spreadsheets are available on the BLS Website.

Industry distribution of nonprofit employment, 2022
Industry	Share of total
Healthcare and social assistance	66.3
Educational services	16.4
Other services (except public administration)	6.3
Arts, entertainment, and recreation	2.6
All remaining industries	8.4
Source: U.S. Bureau of Labor Statistics.

The updated 2022 figures in this table differ slightly from those shown in the bar chart that used 2017 data in a recent DOL research report.

National numbers tell only part of the story, especially when the federal government generates infrequent information. As a result, we spoke with a local expert to find out more about the reasons jobseekers should include nonprofit organizations in their job search strategy.

Large organizations offer a range of opportunities.

Surprisingly, Philadelphia’s largest employers are nonprofit organizations, according to Tim Styer, CEO at Ride to Work, LLC., who has worked in leadership roles at several many nonprofits. Virtually all the healthcare facilities in the City, including Penn Medicine, Jefferson Health, and others are organized as nonprofits.

A profit-making company, Tim said, operated Hahnemann Hospital, a City-owned healthcare institution in Center City, Philadelphia. The facility went bankrupt.

The universities in Philadelphia also operate large higher education institutions as well as hospitals. And you don’t have to be a professor or doctor to find opportunities at these employers. As Superintendent of the Facilities Department at Temple University, for example, Tim told us he supervised more than 300 skilled and unskilled workers. Tim called the beginning of each school year “crunch time” because the institution depended on his team’s work to “get school open.” Their work was essential.

As nonprofits grow in size and sophistication, they are becoming more dependent on a range of experts. For example, nonprofits have to follow complex Sarbanes-Oxley (SOX) regulations according to Tim. And all healthcare organizations and practitioners must comply with HIPAA.

Philadelphia’s well-known museums are also large nonprofit entities.

Outstanding benefits are common.

An advantage of nonprofit work is the organizations tend to offer “great benefits,” according to Tim. Salaries are lower, Tim said, so benefits are a big draw for prospective employees. For example, Tim recalled getting “one month per year off” in addition to “plenty of sick time” at one job, despite low pay.

Other benefits include more reasonable working hours and less emphasis on delivering product. That is because the goal of a nonprofit is to “serve the community,” Tim said. Nonprofits have no owner and no owner’s equity. Instead, nonprofits are expected to be accountable to their communities. Additionally, they may earn a surplus, but not earn a profit—and there are legal limits on the size of the surplus that nonprofits have to follow so they retain tax-exempt status.

Tim noted that a parishioner at his church told him that she is happier as an accountant at a not-for-profit organization. The hours and other benefits are better although her paycheck is smaller than it was at a profit-making firm.

Concluding Comments Do not overlook your city’s nonprofit agencies when you develop your list of target companies at the start of a job search. This is especially important if you are looking for employment in a community with numerous medical and educational institutions, sometimes called “meds and eds.” They are large, complex organizations that need experts in nearly every field to serve your community.