Hoosier Nonprofits Make a Huge Impact

The work of nonprofit organizations touches a lot of lives in Indiana. It’s a very diverse sector that provides an incredibly broad range of community, social, healthcare, education, and other business services. But separate from the amazing work they do – did you know that Hoosier nonprofits also generate a huge economic impact for our state?

A set of four new reports containing nearly two decades of data about Indiana nonprofits was released by the Indiana Nonprofits Project, a joint venture between the Lilly Family School of Philanthropy at Indiana University and Indiana University O'Neill School of Public and Environmental Affairs. Each one of the reports focused on a different region – Northwest, North Central, Northwest Central Indiana, and East Central Indiana. Findings were based on Quarterly Covered Employment and Wage data.

Healthcare Holds the Top

The reports showed the nonprofit industry stabilizes Indiana’s regional economies and employs tens of thousands of people in good-paying jobs. In each of the regions, most nonprofit employees work in health care, with smaller proportions working in social assistance, education, and membership associations. The highest wages can be found in healthcare, and the lowest are in arts, entertainment, and recreation.

Balancing Effect

As Indiana Nonprofits Project Director Kirsten Grønbjerg explained, nonprofits have a unique balancing effect on Hoosier economies during periods of flux.

"Since 2000, each of these regions have faced major economic challenges as jobs in manufacturing declined significantly from 2000 to 2010, with limited recovery in the following nine years. The Great Recession (2007-08) created losses also in other industries,” Grønbjerg said.

“By comparison, over the 2000-2019 period, nonprofit employment and payroll grew in all four regions, and often at faster rates than corresponding rates in the for-profit or government sectors. Clearly, the nonprofit sector played a stabilizing role in the economy of each region," she said.

Regional Impacts

Notable highlights from the regional reports display substantial impacts. Each region corresponds to a number on the Department of Workforce Development’s Regional Map.

The numbers from the four reports are huge, and they only represent a third of Indiana’s 12 regions. There’s a lot more activity out there in addition to what’s tallied here, which really goes to show how much the nonprofit sector matters for Indiana’s economic wellbeing.

• In the Northwest, shown on the map as Region 1, nonprofits had a total payroll of $1.5 billion in 2019. About 33,000 people work for nonprofits. This makes up about 11% of all paid employees and 10% of the total payroll in the region. 63% of the nonprofit workers are in healthcare. Additionally, nonprofit employment and payroll (adjusted for inflation) grew considerably more than for-profit or government employment between 2000 to 2019.
• In North Central Indiana, Region 2, nonprofits had a payroll of $1.9 billion in 2019 and employed about 38,000 people. 43% of nonprofit employees work in health care, and 34% in education. Nonprofit employment trails only manufacturing in the region. Fun fact: St. Joseph's County has the highest percentages of nonprofit employment and payroll among Indiana's 92 counties.
• In Northwest Central Indiana, Region 4, nonprofits had a payroll of $709 million in 2019 and employed about 16,000 workers. Again, most in healthcare. Nonprofit payroll trails only manufacturing.
• And finally, in East Central Indiana, Region 6, nonprofits had a payroll of $636 million in 2019 and employed about 14,000 workers, most in healthcare. Nonprofit employment trails employment in manufacturing and retail trade in the region, but the gaps have narrowed considerably over the 2000-19 period. Nonprofit payroll trails only manufacturing, and that gap has also narrowed.

Definitely Good Work

The totals for just one year of payroll from those four regions comes to about $4.75 billion. That’s only roughly a third of the industry’s total potential economic impact statewide, which makes it clear that nonprofits definitely do a lot of good work for Indiana. They support our communities in all kinds of ways, providing quality careers while conducting important work that makes a real difference in people’s lives.