Reprinted from the Johns Hopkins Center for Civil Society Studies.
In our continuing effort to track the ongoing impact of the coronavirus pandemic on nonprofit employment, this report documents our estimates of COVID-induced nonprofit job losses through February 2021, as reflected in the February BLS Employment Situation Report. While BLS data showed an overall growth of 465,000 private, non-farm jobs nationwide during February 2021, the nonprofit sector accounted for only a modest 6 percent share of these job gains, well below the 10 percent of private jobs they accounted for when the month began. Part 2 of this report details the halting recovery of nonprofit jobs over the past several months and Part 3 provides an updated estimate of the time it will take the sector to return to pre-pandemic employment levels.
Part 1 | Nonprofit job losses as of February 2021
As of February 2021, the nonprofit workforce remained down by over 926,000 jobs compared to February 2020 levels, representing a 7.4 percent decline over the first year of the pandemic, as shown in Figure 1.1 These lost jobs include nearly 35 percent of all workers in nonprofit arts and entertainment organizations; 14.6 percent of nonprofit education workers; 10 percent of all workers in nonprofit religious, grant-making, and civic associations; 7.5 percent of workers in nonprofit social service institutions; and nearly 4 percent of nonprofit health care workers.
As shown in Figure 2, February saw a gain of only 26,562 nonprofit jobs over January’s total—an overall recovery of only 2.8 percent of the 952,600 jobs still lost as of January 2021.2 Of particular note is the overall loss of 1,700 jobs in educational institutions, which, for the first time since September 2020 had seen job growth in January 2021, but could not sustain that in February. All other fields saw overall job gains during February 2021, with the crucial social assistance field leading the pack, gaining 10,563 jobs for an overall increase of 8.7 percent over January 2021’s numbers; and health care adding 8,644 jobs, an increase of 3.3 percent. The particularly hard-hit arts, entertainment, and recreation field gained over 5,000 jobs as gradual re-opening of museums and other entertainment and cultural venues progressed, increasing employment in this field by 4 percent from January 2021 levels. Employment in religious, grantmaking, civic, professional, and similar organizations increased by 2,150 jobs—a 2.5 percent increase over the previous month.
Importantly, February saw a small reversal of the worrying loss of jobs in the health care field seen during January. During that month, nonprofit health care organizations lost an estimated 37,000 jobs—the first decline seen in this key field since the initial months of the pandemic. February saw a return to growth in this field, with 8,644 jobs added, an increase of 3.3 percent over January’s employment levels.
Despite February’s 26,500 restored jobs, as shown in Figure 3, nonprofit employment continues to show only exceedingly slow shrinkage of losses in all fields, continuing the trend seen over the previous four months. [Editor's note: visit the original post to access field-level data.]
Part 2 | Tracking the recovery—June 2020 through February 2021
As reported in our 2020 Nonprofit Employment Report, during the first three months of the pandemic (i.e., March, April, and May 2020), we estimated that nonprofits had lost 1.64 million of the 12.5 million jobs they accounted for prior to the onset of the crisis. As shown in Figure 4, in June, July, and August, significant shares of these initial job losses were recovered. Beginning in September 2020, however, this nonprofit employment improvement slowed significantly, with February’s meager 1.6 percent increase continuing this trend.
In a significant improvement over January, all fields except educational institutions saw improvement in February. However, in only two fields—social assistance and arts, entertainment, and recreation—did this improvement exceed the losses experienced in the prior month. [Editor's note: visit the original post to access field-level data.]
Part 3 | Months to recovery at recent rates
Following the procedure laid out in our December report, we have updated our estimates of the possible time to full recovery of nonprofit employment back to pre-pandemic levels. To do so, we assumed that the average rate of nonprofit job recovery over the previous months (July 2020 through February 2021) will prevail over the foreseeable future. With an estimated 926,045 nonprofit jobs still lost as of the end of February and an average of 39,520 nonprofit jobs recovered per month, this suggests it would take the sector 23.4 months—or nearly 2 years—to return to its pre-COVID level of employment, as shown in Figure 5.
Also shown in Figure 5 are the recovery rates of nonprofit employment in the various fields of nonprofit activity using the same approach, but with one notable exception—education—which has seen an overall average decline over the 8-month period. Given hopeful trends resulting from the Biden Administration’s prioritization of school reopening and its push to speed up vaccinations for education workers we developed an alternate method for estimating time to recovery in this field. To do so, we developed an upper-bound estimate based on the average job gains in this field over the full 9-month recovery period (i.e., June 2020-February 2021), and a lower-bound estimate based on just the three months of June, July, and August, which witnessed the first truncated effort to open schools. What is reported in Figure 6 for education is thus an average of these two projections—yielding an admittedly optimistic estimate of 12 months until nonprofit education employment returns to its pre-COVID level.3
While February’s recovery of 26,562 nonprofit jobs was a marked improvement over January’s marginal growth, the nonprofit sector is still far from achieving a full recovery. What is more, as noted above, these estimates are by necessity based on 2017 employment data because we do not have access to more up-to-date data on jobs in the nonprofit sector. Nonprofit organizations employ the 3rd largest workforce in the U.S., and more timely data are urgently needed to better quantify the effectiveness of policy interventions on this important segment of the U.S. economy. We urge the new Biden Administration to fast-track the release of nonprofit employment and wage data for 2019 and 2020, and to work with BLS to find viable ways to integrate nonprofit-specific data releases into the regular schedule and into other releases, like the monthly Employment Situation reports used in this study. As we enter into the second year of this challenging pandemic—and hopefully into the recovery phase—it is imperative that we improve our understanding of its impact of this important sector of the U.S. economy through better data.
1. To estimate nonprofit job losses, we began with the latest available Bureau of Labor Statistics (BLS) data on nonprofit employment by field, which cover 2017, and calculated the nonprofit shares of total private employment by field as of this date. We then applied these shares to the monthly changes from pre-COVID (i.e., February 2020) levels in private employment by field as reported in the monthly BLS Employment Situation Reports to derive our estimates of monthly changes in nonprofit employment by field, such as those reflected in Figures 1, 2, and 3 of this report. For more on these estimates, see: Salamon & Newhouse, “The 2020 Nonprofit Employment Report,” Nonprofit Economic Data Bulletin no. 48, (Baltimore: Johns Hopkins Center for Civil Society Studies, June 2020).
2. Our January update found that, as of January, nonprofit job losses stood at an estimated 957,731. However, BLS revisions for December and January resulted in a new estimate for January, which we have incorporated in Figure 2. BLS monthly revisions result from additional reports received from businesses and government agencies since the last published estimates and from the recalculation of seasonal factors. For more information, see: U.S. Bureau of Labor Statistics February Employment Situation.
3. In addition to the new priority the Biden Administration has put on school re-opening the updated 12 month estimate of time to recovery for the education field reflects the upward adjustment the BLS made to the growth of jobs in this field during the month of January in its February 2021 report.