Oregon’s Nonprofits in 2017

by Dallas Fridley

June 12, 2018

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 2017 nonprofit stats:

  • 9,652 nonprofit establishments
  • 194,360 nonprofit jobs
  • 44% of all nonprofits were in the other services industry
  • 61% of nonprofit employment was in health care
  • $50,906 in annual average pay
  • $22.27 median hourly wage (1st quarter 2017)
  • Just 4.8 percent of nonprofit jobs paid $10.00 or less per hour
  • Most nonprofit jobs – 70.5 percent – paid $16.00 or more per hour
How Large Is Oregon's Nonprofit Sector? 

In 2017, there were 9,652 nonprofits in Oregon. These organizations played an integral role in Oregon's economy. They made up 6.6 percent of all private businesses in the state and had 194,360 jobs, accounting for 12.2 percent of Oregon's private-sector employment. As a share of Oregon's total (private and public) employment, nonprofits made up 10.3 percent in 2017, about the same amount as the manufacturing industry (10.1%).

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 2017, representing 118,957 jobs or 61 percent. Other services included 25,308 nonprofit jobs and educational services employed 20,856. Together the top three industries represented 85 percent of Oregon’s total nonprofit employment.
Service Organizations
 
The first graph shows that other services had about 13 percent of the state's nonprofit employment (25,308 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 44 percent of Oregon's nonprofit organizations (4,271).

Nonprofit Hospitals: Health Care and Social Assistance

Health care and social assistance led nonprofits with 118,957 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 54 nonprofit hospitals (general medical and surgical; psychiatric and substance abuse; and specialty) employed 56,296 in 2017, or close to half (47%) of the nonprofit health care and social assistance industry's total employment. Oregon’s 81 hospitals (government and private) provided 67,157 jobs in 2017, with nonprofit hospitals representing about 84 percent of the employment.
Educational and Employment Training Providers

Educational services accounted for 11 percent of Oregon's nonprofit employment in 2017 (20,856 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 9,557 jobs (46%) and 335 educational providers (42%). Nonprofit colleges, universities, and professional schools accounted for 9,033 jobs (43%) while representing 18 percent of the nonprofit educational services providers. Other schools and instruction, including sports training, provided 1,461 jobs (7%), and a more significant 22 percent of nonprofit educational services providers.

Pay at Nonprofits Follows Industry Standards

Oregon's private for-profit industries paid an average $50,445 in 2017, compared with $50,906 for nonprofits, a difference of just $461, or 0.9 percent. The 2017 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 2017, four industry sectors reported higher annual average wages for nonprofits compared with for-profit businesses. Nonprofits in financial activities paid an average $80,217 in 2017, which exceeded for-profit pay by about $13,000 or 16 percent. Leisure and hospitality also favored nonprofits by just over $5,100, despite having a relatively low annual average pay of just $26,334.

Health care and social assistance, Oregon’s largest nonprofit industry, enjoyed a pay advantage of almost $8,300 or 15 percent over for-profit employers, paying an average $56,800 in 2017. Other services, with 13 percent of nonprofit employment, paid $29,471 in 2017, falling nearly $3,800 or 13 percent below for-profit employers. Educational services, with 11 percent of Oregon’s nonprofit employment, paid an average $39,026 in 2017, exceeding for-profit pay by over $5,800 or 15 percent.

Rural Versus Urban

Oregon's 23 nonmetro counties provided a home base for 1,748 nonprofit employers in 2017, 7.6 percent of all rural employers. Nonprofit organizations provided 22,665 rural Oregon jobs, or 9 percent of all industries employment. Rural nonprofit pay averaged $44,096 in 2017, which exceeded the average for all industries by 14.6 percent or about $5,600.

In Oregon’s metropolitan areas, nonprofits provided 172,104 jobs in 2017, or 10.6 percent of all metro employment. With 7,906 employers, metros provided a home base for nearly 82 percent of Oregon nonprofits while representing just 6.2 percent of all metro employers. In 2017 nonprofit pay averaged $51,682 in metro Oregon, falling 2.7 percent ($1,408) below the all industries average.

Only four rural counties employed more than 1 percent of Oregon’s nonprofit employment in 2017. Douglas County led rural Oregon with 3,700 nonprofit jobs, or 1.9 percent of Oregon’s total, followed by Klamath County (1.4%), Umatilla County (1.2%), and Wasco County (1.0%). Metropolitan areas commanded 88.4 percent of Oregon’s nonprofit employment led by Multnomah County’s 33 percent (64,346 jobs). Together with Washington County (10.9%) and Lane County (8.6%), Oregon’s top three metro counties represented more than half (52.5%) of all nonprofit jobs in 2017.
The real impact of nonprofit employment across the state can be seen in the accompanying map. In 2017, there were 14 counties where nonprofit employment made up 10 percent or more of total county employment.

Charitable Giving

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 2015, 44.7 million U.S. tax returns were itemized – representing close to 30 percent of all returns. About 36.7 million returns claimed a charitable contribution; accounting for 82 percent of all itemized returns. The average 2015 itemized charitable contribution was $6,058, representing about 18 percent of all deductions claimed.

In Oregon, itemized charitable contributions averaged $4,831 or about 15 percent of all itemized deductions. A slightly lower share of Oregon itemized returns, 80 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 $69,060. Oregon’s AGI averaged $64,319 in 2014, ranking 21st among U.S. states (and the District of Columbia). Oregon’s itemized charitable contribution ranked 39th out of 51, well below first place Wyoming’s $13,231. 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 12th for its itemized charitable contribution ($7,271), while its AGI ranked 46th. Getting back to Wyoming, 54 percent of its adults were defined as “highly religious”, ranking 22nd, while its AGI ($77,370) ranked ninth.

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. Private health care and social assistance grew by close to 5,600 jobs in 2017 to average about 235,900, a one-year increase of 2.4 percent. With 61 percent of Oregon’s nonprofit employment in 2017, 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.
 

 


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