Nonprofits a powerful force in job creation

November 8, 2013

Nonprofits a powerful force in job creation

According to CNN, the nonprofit sector is no lightweight in U.S. job creation. When it comes to employment and nonprofits, the subject is often huddled around high turnover among executives and other key employees. However, CNN reports in 2012 the nonprofit sector is the third largest labor force, coming in just behind retail and manufacturing, and generates almost $1.5 trillion in spending per year. Given the number of nonprofits in the country, it's not surprising their employment numbers are so high.

While organizations often rely on volunteers for fundraising and occasionally to help provide services, they still have businesses to operate. Groups need individuals with skills in finance, management, accounting and marketing like any successful business does. Thus, nonprofits not only offer a high number of jobs, but also a wide variety of jobs.

According to the John Hopkins University report "Holding the Fort:Nonprofit Employment during a Decade of Turmoil," nonprofits have shown impressive resilience in the areas of job growth and creation when compared with the for-profit sector. The report found that during the heart of The Great Recession, nonprofit sector jobs increased by 1.9 percent per year while traditional businesses averaged a loss of 3.7 percent.

While the economy overall has improved since the recession, massive cuts in government funding could mean a tougher road ahead for nonprofits. It will be just as important for organizations to maintain skilled workers among many departments, but they will need to do so with leaner budgets.

Relying on outside experts to handle complex issues
To ensure that nonprofits can focus on the most important aspects of their mission, organizations should consider enlisting the help of outside organizations. Groups that provide services and expertise in areas such as unemployment insurance, financial services and risk management can save organizations resources and money.

Groups such as First Nonprofit Companies can provide various services to nonprofits so that the organization itself can focus on the elements of its business that require unique talents. Even highly skilled employees will burn out fast if they are spread too thin throughout the organization.

Companies can also save money in the long run when turning to experts. Consulting services that help lower unemployment insurance costs or manage other complex issues faced by nonprofits can be a financial benefit. An employee not trained in the areas may be able to complete the day-to-day requirements of the job, but make costly mistakes or miss cost saving opportunities in the long run. 

Content presented by First Nonprofit Companies, the leading provider of state unemployment insurance solutions for 501(c)(3) nonprofit employers.


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CCSCT was approached by First NonProfit to discuss its Unemployment Savings Program and ways the program could significantly reduce the amount of unemployment taxes we were paying. At the time, our agency was paying approximately $80,000 per year. First NonProfit conducted an analysis to determine if making the switch would be in our best interest, and it clearly was based on our circumstances. The first year on the program, CCSCT saw a 70% reduction in its unemployment costs and each year, continues to experience further reductions as a result of having minimal claims. Some additional benefits of the program including having a fixed annual cost, an interest-baring reserve account, professional unemployment claims management and representation at all unemployment hearings. This has been one of the best decisions we have made.

Community Council of South Central Texas, Inc., Seguin, TX

We first started using First Nonprofit’s Unemployment Savings Program when we were a small startup nonprofit.  We didn’t have an HR department and needed expertise in the event that an unemployment claim was made.  We knew we were eligible to be a reimbursing employer, but weren’t sure how to navigate that process.  They made it easy to set things up, plan for, and then manage claims when they came at a very reasonable cost. The amount of time and stress they’ve saved us dealing with all this has been worth way more than the cost.  We’ve now grown to a large nonprofit and do have an HR department but have no plans to stop using their services.  I highly recommend them to every nonprofit I come into contact with!


Throughout our membership in the Unemployment Savings Program, First Nonprofit understood our demands, community dynamics, and the importance of seamless services; that allowed us to serve our constituents better.

Prevent Blindness America, Chicago, IL

Because INCS advocates for the operating conditions that allow charter public schools to provide high quality public education, partnering with First Nonprofit was an easy decision. First Nonprofit’s unemployment programs provide our member schools two operating elements crucial to their ability to provide high quality public education: savings and budget certainty. Capable, committed teachers are the key to student success. By participating in the unemployment insurance savings plan, charter public schools gain peace of mind and are able to invest more money in their teachers.

Illinois Network of Charter Schools, Chicago, IL

It has been our sincere pleasure to maintain a strong, vibrant business partnership with First Nonprofit. We greatly admire their strong industry knowledge, technical expertise, constant professionalism, knowledgeable and dedicated staff. They are always extremely responsive, personable and provide us with the necessary guidance and recommendations on a numerous variety of employment scenarios.

Thresholds, Chicago, IL

NYCON members who use First Nonprofit’s programs enjoy enduring savings and improved efficiency. Our association knows that success, because from the beginning, we achieved the same great benefits. Great savings, seamless technology, and responsive service. NYCON highly recommends First Nonprofit’s remarkable unemployment solutions.

New York Council of Nonprofits, Albany, NY

Visually Impaired Preschool Services has been a client of First Non-Profit since it was first offered as a benefit of VisionServe Alliance. We completed a thorough evaluation of cash savings to our agency before taking advantage of this wonderful benefit and it has been a very wise decision. Our experience with the processes from accounting to claims have been professional, expeditious and easy.

Visually Impaired Preschool Services, Louisville, KY

Luckily for us, our interactions regarding any issues with staffing has been very minimal! I can say that all other interactions with regards to billing, 941 reporting, etc. have been extremely pleasant, accommodating and easy to work with. Kim Ghanayem is always prompt, professional and friendly. Thank you so much!

Neurologic Music Therapy Services of Arizona, Phoenix, AZ