Study: Nonprofits do good but also boost local economy

Nonprofit organizations in Bexar County not only provide residents with needed support and services, they are a powerful force in the local economy, according to a first-of-its-kind study released Wednesday.

Commissioned by the San Antonio Area Foundation working with other organizations, the Nonprofit Economic Impact Study found that area nonprofits inject more than $6 billion annually into the economy through the sector’s payroll and purchases, making it one of the region’s largest industries. 

By contrast, the economic impact of San Antonio’s manufacturing sector was estimated at $40 billion and tourism at $15 billion in the most recent studies available.

“Nonprofits are the heart of the community through their work to enhance the quality of life in our area, but they are often overlooked for the central role they play in our economy,” said Marjie French, CEO of the San Antonio Area Foundation. “They stand shoulder to shoulder with other industries and contribute to the economic strength of their communities at the local, state, and national levels.”

Along with the San Antonio Chamber of Commerce, Family Service Association, the Nonprofit Council, and United Way of San Antonio and Bexar County, the Area Foundation wanted the study in order to establish a baseline for measuring nonprofit impact in the future. 

But the primary purpose of the study was to demonstrate that nonprofits are economic drivers in the community, said Patricia Mejia, vice president of community engagement and impact for the San Antonio Area Foundation. 

And though the research effort began before the coronavirus pandemic took hold in the U.S., it matters more now than ever, she said. “Because of all that’s been happening … the nonprofit sector really served as the stabilizing force before federal aid came in.”

With fewer volunteers and fundraising events in the past nine months, and pandemic-related pressures on the economy and schools, many nonprofits have struggled to keep up with the demand for services and support in the community. 

“This report makes a case for how we will, as a community, understand the need for the nonprofit sector as well as what their needs are,” Mejia said. “I believe our collective understanding and support of the nonprofit sector will determine how we recover.”

The comprehensive look at nonprofits in the county was led by Trinity University researchers Richard Butler, professor emeritus of economics and founding interim dean of the School of Business, and Mary Stefl, former department chair and former dean of the division of behavioral and administrative studies. 

“We know nonprofits for the good works that they do,” Butler said. “They do things in our community that nobody else could do or would want to do. But we think of them mostly [in] sort of a qualitative way – yes, we know they do good works. One of the things we ought to stress today is that the nonprofit sector here is also an important part of the San Antonio economy as businesses.”

Bexar County’s nonprofits are focused on everything from the arts to recreation and sports, but more than half are focused on human services, community improvement, and education. 

The study found that nonprofits in the county employ nearly 68,000 people – about 7 percent of the labor force – with a total payroll of $2.5 billion a year. 

While most of those nonprofits are small, with nearly 80 percent employing fewer than 10 staff members, 26 organizations in the area employ more than 500 people, mostly in the education and health care sectors. 

Revenue totals vary widely among the county’s nonprofits. More than half earn less than $250,000 a year, but 99 nonprofits take in more than $10 million a year.

“The numbers are significant and undeniable – nonprofits are major players as employers and partners in improving the quality of life in our region,” stated Richard Perez, president and CEO of the San Antonio Chamber.

As mayor, Ron Nirenberg said he sees firsthand how nonprofits are important partners in the community.

“Sometimes their work and impact are dramatic and widely recognized, such as the San Antonio Food Bank’s role during the COVID-19 pandemic,” he said. “More often, nonprofits toil quietly and without fanfare, as they help our city’s residents improve their lives in less visible ways such as teaching financial literacy, assisting children and shattered families, buying school supplies, and so much more.”

The San Antonio Area Foundation is a financial supporter of the San Antonio Report. For a full list of supporters, click here.