Maine’s nonprofit sector, often considered a weak-kneed contributor to the state’s economy, is actually a major player, providing employment for one of out every eight workers collectively earning $2 billion a year, according to a study released Wednesday.
Included in the study: Maine’s nonprofit sector generally pays its workers significantly more than similar workers in for-profit companies, a disparity fueled predominantly by the expansion of nonprofit colleges and hospitals in the state.
The study, commissioned by a collaborative of Maine foundations, was released by the Maine Association of Nonprofits to illustrate the significant role that sector plays in the state’s economy.
The study piggybacks on a report issued last spring, which analyzed growth in the nonprofit sector. It showed charities contributing a whopping 12.8 percent of the gross state product, well over the 7.8 percent national average.
“While everybody knows about nonprofits, and their missions and good works, it’s never been looked at as a significant sector of the economy,” said Scott Schnapp, executive director of the Maine Association of Nonprofits.
“The information in this report is validating and surprising,” he said.
The study, by researchers at Johns Hopkins University, shows Maine’s private, nonprofits employ 70,352 workers, about 12 percent of the state’s work force. The national average is 7.2 percent.
One of the most surprising analyses compared wages between nonprofit and for-profit sectors employees. In every category, the private, nonprofit workers earned more than their colleagues in the for-profit sector. In some categories, the disparities were wide: in home health care, nonprofit workers earn an average weekly wage of $462; for-profit workers earn $344. Residential care facilities show nonprofit workers earning $422 and for-profit, $317.
“This really illustrates that this sector is a very significant player in terms of the work they do and actual wages and employment,” said Schnapp. His organization represents 500 nonprofit members in the state.
And it’s a sector that’s growing. In 1990, there were 1,099 charities that reported to the IRS. In 2000, that figure rose to 1,805. Charities held $2.8 billion in assets in 1990; 10 years later that number nearly tripled to $7.9 billion.
Schnapp said part of that growth is likely attributable to the expansion of hospitals and colleges. Assets include endowments and facilities.
“I think the growth in this sector is largely driven by these big players,” said Schnapp.
Health organizations make up about half of Maine’s nonprofit jobs (34,900). Social services account for 28 percent of the jobs (19,850) and educational services at 11 percent (7,800 jobs) is the next highest.
And the greatest concentration of nonprofit employers seem to be in urban areas. Cumberland County has the highest number of nonprofit employees (19,885), followed by Penobscot (8,918), Kennebec (7,992) and Androscoggin (6,587) counties. More-rural counties have much fewer: 1,151 in Franklin and 2,109 in Oxford, for example.
Schnapp said he hopes to use the information from the study as an educational tool to promote the importance of the nonprofit sector, especially with state legislators and public policymakers.
“We’d like to create a dialogue,” he said.
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