Oregon’s Nonprofits in 2015February 28, 2017 A not-for-profit corporation, commonly referred to as a "nonprofit," is organized to achieve a purpose other than to generate a profit. These entities qualify for federal tax exempt status and must reinvest any surplus revenues into efforts that further the mission of the organization. They are prohibited from passing profits on to those who control the organization. These organizations range from trade unions and religious groups to food banks and private schools. Many hospitals are also organized as nonprofit corporations.
The services are essential. Wages earned by employees at nonprofits are too. For the purposes of this article, the impact presented is limited primarily to employment and wages.
Oregon's 2015 nonprofit stats:
- 9,366 nonprofit establishments
- 183,075 nonprofit jobs
- 46% of all nonprofits were in the other services industry
- 61% of nonprofit employment was in health care
- $47,554 was the annual average pay
- $20.79 median hourly wage (1st quarter 2015)
- Only 3.1 percent of nonprofit jobs paid $9.25 or less per hour
- Most nonprofit jobs – 70.3 percent – paid $15.00 or more per hour
In 2015, there were 9,366 nonprofits in Oregon. These organizations played an integral role in Oregon's economy. They made up 6.4 percent of all private businesses in the state and had 183,075 jobs. These jobs accounted for 12 percent of Oregon's private-sector employment, down slightly from 2013’s 12.2 percent. As a share of Oregon's total (private and public) employment, nonprofits made up 10.3 percent in 2015, about the same amount as the manufacturing industry (10.4%).
Beyond employment, the organizations make available essential human and education services that for-profit private companies do not provide. The services offered by nonprofits often complement those provided by the public sector. Unlike the public sector, which is often required by law to provide human and education services, nonprofits are beholden to a mission, not a state or federal statute. The organizations are compelled to extend their hand to every community member who walks through their doors.
Nonprofits by Industry
Health care and social assistance dominated Oregon’s nonprofit employment in 2015, representing 112,125 jobs or 61 percent. Other services included 24,759 nonprofit jobs and educational services employed 20,699. Together the top three industries represented 86 percent of Oregon’s total nonprofit employment.
The first graph shows that other services had about 14 percent of the state's nonprofit employment (27,512 jobs). The correlation between other services and nonprofits makes sense. It is the industry that includes religious, grant making, civic, professional, and similar organizations. Places of worship, the Boys & Girls Club, The United Way, and local chambers of commerce are some of the most widely recognized nonprofits in Oregon, and there are a lot of these organizations across the state. The second graph shows that the industry included 46 percent of Oregon's nonprofit organizations (4,270).
Nonprofit Hospitals, Health Care and Social Assistance
Health care and social assistance led nonprofits with 112,125 jobs or 61 percent of Oregon's nonprofit employment. Like other services, there is diversity in the industry from assisted living facilities to mental health services. However, hospitals completely overshadow the sector’s employment. Oregon’s 58 nonprofit hospitals (general medical and surgical; psychiatric and substance abuse; and specialty) employed 53,571 in 2015, or nearly half (48%) of the nonprofit health care and social assistance industry's . Oregon’s 90 hospitals provided 64,082 jobs in 2015, with nonprofit hospitals representing 84 percent of the employment.
Educational and Employment Training Providers
Educational services accounted for 11 percent of Oregon's nonprofit employment in 2015 (20,699 jobs). The organizations in this industry range from preschools and tutoring services to colleges and employment training places. Nonprofit elementary and secondary schools represented the biggest slice with 9,563 jobs (46%) and 349 educational providers (45%). Nonprofit colleges, universities, and professional schools accounted for 8,949 jobs (43%) while representing 17 percent of the nonprofit educational services providers. Other schools and instruction, including sports training, provided 2,187 jobs (10%), and a more significant 39 percent of nonprofit educational services providers.
Pay at Nonprofits Follows Industry Standards
Oregon's private for-profit industries paid an average $47,602 in 2015, compared with $47,554 for nonprofits, a difference of just $48, or 0.1 percent. The 2015 data show that annual average wages in Oregon typically have more to do with the industry than for-profit or not-for-profit status.
In 2015, six industry sectors reported higher annual average wages for nonprofits compared with for-profit businesses in the industry. Nonprofits in financial activities paid an average $73,921 in 2015, which exceeded for-profit pay by $11,022, or 15 percent. Leisure and hospitality also favored nonprofits by $5,384 despite having a relatively low annual average pay of just $24,707.
Health care and social assistance, Oregon’s largest nonprofit industry, enjoyed a pay advantage of $6,741 or 13 percent over for-profit employers, paying an average $53,246 in 2015. Other services, with 14 percent of nonprofit employment, paid just $27,512 in 2015, falling $2,509 or 9 percent below for-profit employers. Educational services, with 11 percent of Oregon’s nonprofit employment, paid an average $36,658 in 2015, exceeding for-profit pay by $5,208 or 14 percent.
Rural Versus Urban
Oregon's 23 non-metro counties provided a home base for 1,740 nonprofit employers in 2015, 7 percent of all rural employers. Nonprofit organizations provided 21,364 rural Oregon jobs, or 9 percent of all industries employment. Rural nonprofit pay averaged $41,492 in 2015, which exceeded the average for all other industries by 14 percent or $5,907.
In Oregon’s metropolitan areas, nonprofits provided 160,506 jobs in 2015, or 10 percent of all metro employment. With 7,406 employers, metros provided a home base for nearly four out of five Oregon nonprofits while representing just 6 percent of all metro businesses. In 2015 nonprofit pay averaged $48,399 in metro areas, falling 3 percent ($1,369) below the average for all other industries.
Only four rural counties employed more than one percent of Oregon’s nonprofit employment in 2015. Douglas County led rural Oregon with 3,443 nonprofit jobs, or 1.9 percent of Oregon’s total, followed by Klamath County (1.3%), Umatilla County (1.2%), and Wasco County (1.0%). Metropolitan areas commanded 87.7 percent of Oregon’s nonprofit employment led by Multnomah County’s 33.3 percent (60,922 jobs). Together with Washington County (10.8%) and Lane County (8.8%), Oregon’s top three metro counties represented more than half (52.8%) of all nonprofit jobs in 2015.
The real impact of nonprofit employment across the state can be seen in the accompanying map. In 2015, there were 14 counties where nonprofit employment made up 10 percent or more of total county employment.
The IRS produces tax data for itemized returns showing deductions for charitable giving. According to the IRS definition, a charitable contribution is when you donate money (including securities or business ownership interests), goods or services to an organization and deduct the market value of this contribution on your income tax return. Your charitable contribution can be given to:
- Churches, synagogues, temples, mosques, and other religious organizations
- Federal, state and local governments, if your contribution is solely for public purposes (for example, a gift to reduce the public debt or maintain a public park)
- Nonprofit schools and hospitals
- The Salvation Army, American Red Cross, CARE, Goodwill Industries, etc.
- War veterans’ groups
- Expenses paid for a student living with you, sponsored by a qualified organization
- Out of pocket expenses when you serve a qualified organization as a volunteer
In Oregon, itemized charitable contributions averaged $3,792 or about 15 percent of all itemized deductions. A slightly lower share of Oregon itemized returns, 81 percent, included a charitable deduction. It is important to recognize that adjusted gross income (AGI) varies widely from state to state – with U.S. AGI for all returns averaging $64,685. Oregon’s AGI averaged $59,845 in 2014, ranking 26th among U.S. states. Oregon’s itemized charitable contribution ($3,792) ranked 40th out of 50 U.S. states, well below first place Wyoming’s $11,588. That matches up pretty well with the Pew Research Center’s 2014 Religious Landscape Study, which ranked Oregon as the 39th most religious state (49% of adults were “highly religious”). Alabama, the most religious state according to the Pew Research study (77% “highly religious”), ranked eighth for its itemized charitable contribution ($5,878), while its AGI ranked 45th. Getting back to Wyoming, 54 percent of its adults were defined as “highly religious”, ranking 22nd, while its AGI ($77,370) ranked sixth.
The Future of Nonprofit Employment
The future of nonprofit employment in Oregon is directly linked to the future of the health care and social assistance industry. The nonprofit health care and social assistance industry doesn’t rely exclusively on charitable contributions, although these businesses often hold a direct religious affiliation. Health care and social assistance grew by 9,069 jobs in 2015 to total 221,731, a one-year increase of 4.3 percent. With 61 percent of Oregon’s nonprofit employment in 2015, health care and social assistance will largely determine how and where new jobs are gained.
For example, Providence Health & Services in Oregon is a not-for-profit network of hospitals, health plans, physicians, clinics, home health services, and affiliated health services. Providence is the largest health care provider in Oregon and one of the largest private employers in the state. It reported 2016 employment of 20,597 in Oregon, of which 3,650 were active medical staff. Providence health plans cover about 600,000 Oregonians, while reporting a community benefit of $417.5 million. http://oregon.providence.org/about-us/oregon-at-a-glance/.