Civic & Social Organizations
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 24,100 civic and social organizations in the US promote the civic and social interests of members. The industry includes a wide range of organizations, including alumni groups, booster clubs, fraternal associations, scouting organizations, PTAs, fraternities and sororities, student associations, and veteran’s organizations. Civic and social groups operate as non-profit organizations and are exempt from federal income taxes.
Membership Affected by Demographic Trends
Because most civic and social groups operate locally, demographic trends in a particular market can greatly affect membership.
Reliance on Contributions
Contributions, gifts, and grants account for almost 30% of industry revenue and are the single largest source of funding for civic and social organizations.
Industry size & Structure
A typical civic or social organization operates out of a single location, employs about 11-12 workers, and generates $809,000 annually.
- The civic and social organization industry consists of 24,100 organizations that employ 274,300 workers, and generate over $19 billion annually.
- The industry includes a wide range of organizations, including alumni groups, booster clubs, fraternal associations, scouting organizations, PTAs, fraternities and sororities, student associations, and veteran's organizations.
- The industry is highly fragmented; the 50 largest organizations account for just over 15% of industry revenue.
- Large organizations include Freemasons, Boy Scouts, American Legion, and the YMCA.
- A vast majority of civic and social organizations are non-profit.
Industry Forecast
Civic & Social Organizations Industry Growth
Coronavirus Update
Oct 20, 2021 - Nonprofit Jobs Recovery Slows
- Many civic and social organizations suspended member access, activities, and programs during the coronavirus outbreak based on recommendations from the CDC and federal, state, and local health officials. Some organizations offered online alternatives for classes and activities. Other outreach efforts included programs in which volunteers call to check-in on and provide contact for isolated and homebound seniors, emailing information on depression and stress reduction, and providing referrals to calls for help. As the pandemic has caused job losses and other stresses on military families, some VFW posts have raised food donations and are delivering them to military families in need. During the pandemic, one in five military families have become food insecure compared to one in eight in 2019, according to the Military Family Advisory Network.
- The rapid spread of the Delta variant of the coronavirus during the summer may have complicated some organizations’ plans to normalize member access, activities, and/or programs. However, infection rates began to slow in mid-September. As of October 19, the 14-day change in new cases of COVID-19 was down 22%, but daily new cases remained high at more than 79,000. Hospitalizations and deaths were also declining. On April 19, all Americans over age 16 became eligible to be vaccinated. As of October 19, nearly 190 million Americans were fully vaccinated or about 57% of the US population.
- Nonprofit civic and social organizations are finding their budgets squeezed as demand for services remains but staffing and donations waned. More than half of US nonprofits saw more demand for services during the pandemic and one-third are experiencing higher operating costs, according to the Nonprofit Leadership Survey Report 2021 from Grassi Advisors & Accountants. Organizations that received funding from state and local governments may receive less as governments trim their own budgets due to reduced tax revenue. A fresh round of stimulus relief was passed in December. The $900 billion spending bill included more than $284 billion for first and second forgivable Paycheck Protection Program (PPP) loans through the Small Business Administration (SBA), and expanded eligibility for nonprofit organizations. However, the bill did not include aid for state and local governments. Typical nonprofits get four times as much funding from state and local governments as they do from private foundations, according to Nonprofit Quarterly.
- In March 2021, President Biden signed the $1.9 trillion American Rescue Plan Act (ARPA). The third round of stimulus includes $360 billion in aid to state and local governments. State and local governments are free to spend the funding on nonprofits that serve the greater good of the community. The ARPA also included an additional $7.25 billion for the PPP. The PPP was set to wind down on May 31, but the program ran out of money on May 11, 2021 and stopped accepting most new applications, according to The New York Times. More than 80% of city finance officers said direct federal aid had a positive effect on their fiscal year 2021 budgets, according to the annual City Fiscal Conditions survey released by the National League of Cities in October. Two-thirds of cities said ARPA funding helped replace lost revenue and more than half used ARPA funds to directly aid households, small businesses, nonprofits, and local industries.
- As COVID-19 vaccinations have ramped up, many nonprofits are stepping up to help, according to The Chronicle of Philanthropy. Organizations that normally respond to disasters provided equipment, and logistics and operational support of mass vaccination and test sites. However, by early July 2021, US supplies of vaccine had outstripped demand as most people who wanted vaccines had received them, according to The Wall Street Journal. Government-run mass vaccination sites and in-store, appointment-based vaccine clinics in pharmacies are being wound down. While volunteering needs for closed or scaled back vaccination sites will fall, demand may shift to more targeted efforts aimed at those who are vaccine hesitant or lacked easy access to vaccine sites. Nonprofits that typically provide outreach to specific groups, including people of color, the LGBTQ community, the elderly, and people experiencing homelessness, are working with state and local governments to determine how to best get vaccines to the people they serve. Some charities are also recruiting volunteers to help non-English speakers connect with vaccination registration resources.
- As vaccinations have reduced the severity of the pandemic and restrictions are increasingly relaxed, some nonprofits may struggle with how to bring their employees back to the office, according to The Chronicle of Philanthropy. Establishing workplace safety guidelines presents challenges such as whether or not to require masks and/or vaccinations, what percentage of workers should return, and how vaccination status should be determined. Another key concern is how to ensure advancement opportunities remain equitable among employees who prefer to work remotely most of the time versus those who like to be in the office. Some nonprofits’ plans for returning to the office were complicated by the change in CDC guidance that said fully vaccinated people needn’t wear masks indoors or out.
- Giving to charitable causes rose during the pandemic, helped along by a rising stock market and government stimulus, according to the Annual Giving USA Foundation report released in June. Charitable giving increased 5% in 2020 to $471.4 billion – a new record. Donations were aided by healthy gains on Wall Street – the S&P 500 rose more than 16% by the close of 2020. Stimulus payments sent directly to Americans also helped boost giving as personal incomes went up. Giving by foundations grew the most with a rise of 17% and reached $88.6 billion. Corporate giving declined 6.1% to $16.9 billion as the pandemic put a dent in firms’ profitability. Donations from individuals were up 2.2%. Giving planned in the event of a person’s death, or bequests, grew 10.3%. Charitable organizations focused on civil rights and environmental issues saw the largest jump in giving. Donations also rose for charities involved in religious, education, and human services causes. Health-related charities experienced a 3% dip in donations as the pandemic sidelined walks and fun runs that are major sources of fundraising. Arts giving declined 7.5%. The momentum gained in 2020 is expected to carry into 2021, according a survey conducted in July and August 2021 by Artemis Strategy Group on behalf of Fidelity Charitable. About 90% of those surveyed said they planned to give in 2021 as much or more than they did in 2020. Donors said they will continue to support causes that gained attention during the pandemic, including curing diseases, hunger, and responding to community needs.
- While charitable giving was up in 2020 and growth has continued in 2021, the pandemic put a dent in volunteering. Prior to the pandemic, two-thirds of those who donate to nonprofits also volunteered, according to Fidelity Charitable. During the pandemic the percentage of donors who also volunteer fell to one-third. However, while donors say they will continue to curb in-person volunteering, they intend to do more virtual volunteering. The percentage of donors who will do a combination of in-person and virtual volunteering is expected to be about 32% compared to a pre-pandemic 17%.
- Job growth in the nonprofit sector slowed in September, according to estimates by the Center for Civil Society Studies at Johns Hopkins University. On average, the nonprofit sector has added about 44,624 jobs per month in the first nine months of 2021. At that pace, it will take more than 12 months for sector employment to fully recover to pre-pandemic levels. Pockets of nonprofit job growth in September included, social assistance organizations (+12,249 jobs), and arts, entertainment, and recreation organizations (+6,673). Weakness remained for education (down 13,408 jobs in September), nonprofit healthcare institutions (-7,602), and religious, grantmaking, civic, and professional organizations (-4,244). As of September, nonprofit employment was still down 557,000 jobs compared to before the pandemic.
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