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Charities hit hard in rough economy

May 29, 2008

Ryan Dinkgrave

In a struggling economy, most businesses feel the stresses of decreased revenues as a result of decreased demand for their products or services, as people have less disposable income for such spending. For nonprofit organizations that provide social services, however, demand often increases during difficult economic times, while revenues decrease. This puts such organizations in the difficult position of having to provide more services to more people but with fewer resources.

In Michigan, the changing labor market, economic uncertainty, housing crisis, and rising food and gas prices force many families to seek a variety of social services, while also causing decreases in donations to these organizations. Despite these challenges, 23,000 nonprofit organizations in Michigan continue to pursue their educational, charitable, literary, health, environmental, cultural, scientific, and religious missions.

Many of these organizations provide the basic services that those most affected by poverty, health, and other challenges need, including those that provide food to the hungry, house the homeless, protect abused women and children and more. Sometimes they fill the void that is left between government service offerings and actual need, while other times they serve as local administrators and deliverers of government aid through the coordination of volunteer efforts.

In addition to providing services directly to people in need, they also provide people opportunities to contribute their own time and efforts to causes that they care about. According to statistics from the Michigan Nonprofit Association (MNA), almost half of Michigan citizens volunteer each year.

Because these organizations are designated as nonprofits by the Internal Revenue Service, they are prohibited from conducting political campaign activities to influence elections. However, though they cannot advocate for or against a particular bill, these organizations can and often do serve as educators for the public in regard to a particular issue facing society. These organizations also help develop public policy options for government to consider in crafting legislation. Some of these organizations help advocate for causes by providing a voice for underrepresented segments of the population, allowing greater citizen participation in a free society.

While most people are familiar with the role that nonprofit organizations play in providing such social services to the community, fewer are aware of the significant economic contributions of nonprofit organizations in Michigan. In fact, the Michigan nonprofit sector is the fifth largest industry in the state in terms of employment as it provides about 380,000 jobs. According to the MNA, Michigan nonprofits generate nearly $69 billion in total economic activity annually and have assets of more than $80 billion.

While these figures are significant and impressive, they do not mean that these organizations are able to operate indefinitely. Regardless of where your interests lie, whether they be in direct service provision (such as feeding the hungry or volunteering at a day camp for low-income children), animal causes (assisting at a shelter or with an animal rescue group), or environmental, religious, educational, or other causes, there are opportunities for you to contribute your time and effort. You can find such volunteer opportunities by accessing Volunteer Match (www.volunteermatch.org) or the Michigan Community Service Commission (www.michigan.gov/mcsc) Web sites. If you are not able to volunteer but still wish to make a contribution to a cause that interests you, these same sites can help you identify nonprofit organizations that you can make a financial donation to.

For those who wish to fully immerse themselves in the pursuit of a nonprofit organization’s mission, there are various opportunities for employment in the nonprofit sector in Michigan. The general perception is that people employed in the nonprofit sector do not make as much as their peers in the private sector, a perception that is not entirely unmerited, but not entirely true, either. Indeed, many people who work in the sector do so because they genuinely are dedicated to a cause and are willing to forego higher wages in exchange for the personal satisfaction of working toward a meaningful cause. However, many people in the nonprofit sector make very competitive wages, especially those who gain experience in the fundraising areas of nonprofit organizations, as these are some of the most critical positions that must offer competitive pay in order to get the greatest talent. The MNA posts nonprofit job listings on its Web site (www.mnaonline.org/classified.asp).

Whether you donate your time, donate your money, or even dedicate your employment to a nonprofit organization, everyone has the potential to recognize and support this important sector and its contributions to and role in our state and society.

Ryan Dinkgrave is a State News columnist. Reach him at dinkgrave@msu.edu .

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