According to the National Council of Nonprofits’ Nonprofit Impact Matters report, there are 1.3 million charitable nonprofit organizations in the United States. They serve people of various ages, genders, and socioeconomic statuses in the areas of food, health, shelter, education, human rights, culture, and the environment.
How Nonprofits Help
These nonprofits promote leadership and civic engagement by nurturing, inspiring, enlightening, and strengthening communities in urban and rural areas to thrive in a more equitable environment. They concretely reinforce democracy because as they encourage community members to engage with each other, the people learn skills in collaborative problem-solving. In the process, they develop leadership and management skills among the people.
Based on a 2018 study by Marsh & McLennan, nonprofit organizations provide shelter for more than 200,000 elderly Americans and 670,000 foster children. They also have food banks that feed more than 46 million people.
Non-profit organizations have a huge positive economic impact. Data show that as of 2016, non-profit organizations spend two trillion dollars annually, with half of that going to the purchase of goods and services such as medical equipment and supplies and other operational needs. Over $826 billion of their annual spending go to salaries, benefits, and tax payments for the 12.3 million people they employ, representing more than 10 percent of the U.S. private workforce. This exceeds the payrolls of most of the other U.S. industries such as transportation, construction, and finance.
Non-profit organizations also give more Americans the opportunity to join the workforce through their education and training initiatives. Furthermore, the childcare services they provide enable parents to work full-time.
What Nonprofit Means
Non-profit organizations are tax-exempt, but they can make a profit or surplus when they have funds left after expenses. The difference is that this surplus is not paid to any owners or investors. Instead, it goes back to the organization’s budget for its charitable mission.
Non-profit organizations have overhead costs like rent, utilities, insurance, and the salaries and benefits of their staff, from their leaders to administrative, accounting, and information technology (IT) personnel, among others. Usually, nonprofit employees also include writers, researchers, trainers, social workers, and field workers.
Where Nonprofits Get Funding
Most or 92 percent of nonprofit organizations are small and work in the grassroots, with 92 percent having budgets below one million and 88 percent having budgets below $500,000. In general, nonprofits earn 49 percent of funds through their services, 31.8 percent come from government contracts and grants, 10.2 percent come from donations from private individuals, 3.8 percent come from donations from foundations and corporations, and 5.2 percent comes from other sources such as investments and fundraising activities.
Small to medium-sized nonprofit organizations, as well as those working for the environment, animals, humanities, culture, and arts, depend more on grants from foundations and donations from individuals. Larger nonprofits—mostly educational institutions, hospitals, and other healthcare institutions—earn more from their services. Hospitals, healthcare institutions, and nonprofits that provide human services also earn from government payments.
How Nonprofits Can Work Better with Technology
To be able to reach donors and the communities they are serving more efficiently and effectively, nonprofit organizations must step up their digital preparedness. While face-to-face interaction has always been a strength of non-profits, the current situation calls for additional modes of communication and outreach that are safer and more immediate.
Experts from the Forbes Nonprofit Council advise nonprofits to move to cloud services and managed services with high security. This reduces costs and outages and enables their large network of people to connect remotely on the same platform.
Nonprofits must also upgrade their basic equipment, such as having computers with advanced solid-state drives and SSD software. This will enable them to work faster and better, especially when creating graphic images, podcasts, and video productions. According to the Forbes report, by 2021, 82 percent of consumer traffic online will be video. Video productions are an effective way of showing donors and funding agencies the situation on the ground.
Social media is a powerful means of connecting to everyone. Non-profits must be present on all social media channels. They can use these to listen and gather data as well as disseminate information. They can maximize the use of live social media events to take the place of public gatherings while it is not yet safe to do the latter.
Digital apps can make it easier for individuals and institutions to donate to nonprofits. Various payment options must be available online for a quick and secure process.
Digital learning management systems can provide education, training, and development among staff and in target communities. As a virtual school, the system offers content libraries and enables individual or collaborative virtual problem-solving practice, and then provides reports on the learners’ improvements.
Improving for the Greater Good
Any advances among nonprofits redound to the good of the entire society. After all, these organizations exist to serve the needs of the underserved social groups, lightening the burden for all. It is only right to use technological innovations to support these altruistic endeavors.