COVID-19 Implications for Non-Profits

Turning on the news, or scrolling through your news feed, you are bombarded by the non-stop headlines and announcements. Businesses are closing, schools are shuttered, people are being asked to work from home, or even losing their jobs. We are rightly concerned about the impact of the coronavirus pandemic and necessary quarantine on our economy, worried about how the lack of consumer spending will impact businesses large and small, and how we will cope with the dramatic changes facing our communities.

And it is during crises like these, and during the long recoveries after crises, that we rely upon the organizations that make up our non-profit sector to help us cope with the challenges, care for and educate our children, rebuild our communities, entertain and distract us, and bring beauty and light to our lives just when it seems darkest. The American non-profit community has always been the envy of the world – large and small organizations, largely supported by voluntary contributions, supporting and enriching our communities in innumerable ways. In partnership with government, non-profits are who we rely upon daily to support our communities without even thinking of it, but are crucial at times of crisis like the one we are facing today. Our non-profit arts and culture organizations also are the ones who take our minds off our troubles, and serve as ambassadors for our regions to visitors and residents alike

Yet, just as this crisis has impacted the for-profit businesses in our community, it is also impacting the non-profit community. We know the dramatic impact on our largest non-profits, who serve as drivers and anchors of the Philadelphia economy and that of most regions. We are looking to our health care institutions to take on an immense burden in the coming months, and we’ve seen higher education institutions have to adjust their models to deal with the realities of this virus.

For human service organizations, just as the need for their services is rising, the economic crisis and uncertainty facing their donors and supporters is also rising. For child-care and other educational organizations that rely on payments for services provided, closures directly impact their bottom line. For arts and cultural organizations, performances have been canceled, fundraisers postponed, and already tight budgets are facing devastating impacts.

This also matters because non-profits are businesses as well. According to the US Bureau of Labor Statistics (BLS), in Pennsylvania in 2017, there were over 19,000 501c3 non-profit organizations, employing over 800,000 people annually (15% of PA’s total employment in 2017), with total wages of over $43 billion. From an employment perspective, hospitals and colleges, universities and professional schools make up the largest share, with nearly 500 organizations (large and small) and nearly 700,000 employees. The remaining 18,500 nonprofit organizations, many of which are small, have over 100,000 employees.

So, it is doubly important to support the non-profit community during this crisis. First, they support and enlighten us, and help to define our region. And they are important to our economy in so many ways. Fortunately, there are a number of ways to help:

  • Respond to nonprofit requests for donations. Most non-profits are reaching out to their past supporters to remind them of their value to the community. Make a donation and let them know you value them.
  • See if you can help – volunteers are also affected by the quarantine, but services still are needed. Even if you can’t go out, maybe you can make some calls, or help in some other way. Many organizations are getting creative with fundraisers – maybe a virtual gala is more your thing than black ties anyway!
  • Buy a ticket or membership now that you will use when this is all over. Just as with restaurants, a little cashflow now can go a long way. See the Cultural Alliance website for more info on how the crisis is affecting non-profit arts organizations and what you can do.
  • Support the PHL COVID-19 Fund that has been set up by the Philadelphia Foundation and the United Way of Greater Philadelphia and Southern New Jersey – these organizations know the social services needs and will be sure to get the funds to the right places. The fund launched on 3/19 with $6.5 million, but much more is likely to be needed.
  • Support the other regional United Ways — Bucks CountyChester County, and Mercer County along with the Delaware United WayPennsylvania United Way, and United Ways of New Jersey. All are great resources on where you can help, and where to go if you need help.

We at ESI work closely with many in our non-profit community, helping them to tell their stories about their value to the community. It is in times like these that we need to show how we value them.

 

Steve WraySteve Wray is a Vice President, Strategic Initiatives, at Econsult Solutions, Inc. (ESI). In this role, Steve develops, oversees and helps implement programs and projects that support ESI’s vision and short- and long-term plans. He supports the work of the firm’s principals and senior staff in developing new partnerships, expanding and building on existing practice areas, and integrating the firm’s strengths in economic analysis and thought leadership.

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