The Economic Impact of Nonprofits in Westchester The Wilson Center for Social Entrepreneurship, Pace University -In partnership with- The Business Council of Westchester November 8, 2007

The Growth of the Nonprofit Sector  From 2000 to 2007, the number of registered nonprofit organizations in Westchester County increased from 3,406 to 4,179, an increase of 23 percent.

 These 4,179 registered nonprofit organizations constitute 5.7% of the total number of nonprofits in NYS (73,597) Note: The number of NYS-based nonprofits has increased 26% since So, Westchester roughly approximates state-wide growth of the nonprofit sector.

 Registered Public Charities 20012, ,176  An increase of 25%  Registered Private Foundations  An increase of 16%

Key Financials:  As of the first quarter of 2007, the reported total revenue of nonprofit organizations was over $5.9 billion and total assets of $8.1 billion (estimated)

-Assets: Public Charities  2001$4.9 Billion  2007$5.7 Billion  An Increase 16% Private Foundations  2001$1.9 Billion  2007$2.4 Billion  An Increase 12%

-Revenues (all sources) Public Charities  2001$3.9 Billion  2007$4.5 Billion  Increase15% Private Foundations  2001$472 Million  2007$1.4 Billion  Increase87% (likely fueled by 911, Katrina, and asset/income growth of wealthy individuals/families).

-Expenses and Liabilities  Public charities (2005) $2.4 billion (estimated) of total liabilities which is an increase of 100,000 million since Over $3.7 billion (estimated) of expenses which is an increase of 250,000 million since  Private Foundations, by nature, typically post low total expenses and have shown modest growth in these categories since 2000.

Employment and Wage Figures  Westchester nonprofit organizations employed approximately 40,560 persons in 2006 (estimated from BLS employment categories) which is up from 35,107 from the year 2000; a 15% increase.  However, as a percentage of the total workforce, nonprofits constitute a little over 8% in 2006 which is the same percentage as in the year 2000.

 So, projected estimates of workforce breakdowns by sector are: Nonprofit Sector40,560 8% Private Industry 382,000 79% Government61,000 12%

Salary Levels In Nonprofit Fields MeanMedian  Medical and Health care$90,160$82,170  Education Administrators$87,500$81,340  Various Public Health$40,672$38,550  Religious Related Occupations$36,907$31,790  Arts and Related professions$49,620$36,780  Community and social Services$41,030$37,900

Wage Structure  However, estimated mean annual income for all sectors fell from $43,915 as reported in 2000 to $42,912 as estimated in 2005, with nonprofit salaries typically lagging behind their public and private sector counterparts.

Measuring Additional Economic Impact: The Multiplier Effect  According to the Federal Reserve bank of New York (Staff Report No. 241, 2006), the spending multiplier for this region is about 3.4 Which means every dollar made/spent generates $3.40 in additional business activity in the region.  So, for instance, using the 2005 spending figure of nonprofits ($3.5 billion), the overall economic impact of this nonprofit spending would be in excess of $11.9 billion for the region.

“Take Aways”  The Nonprofit sector in Westchester continues to grow in line with the statewide average.  Nonprofits constitute a significant source of economic activity in Westchester and employ a substantial percentage of the workforce.  As a whole nonprofits show good efficiency in their expense to revenue ratios and have enjoyed modest asset growth since 2000.

Questions for Further Study?  Expenses  Wages  Operating Margins  Funding

Data Collection and Analysis by: Farrokh Hormozi, Ph.D., Professor, Pace University Edited and Presented by: Brian J. Nickerson, Ph.D., Professor, Executive Director, Wilson Center at Pace University