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Nonprofits Drive Big Job Creation

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The good nonprofit organizations provide to society extends beyond the charities they support, new research shows.

A study from the Johns Hopkins Institute for Policy Studies reveals that nonprofit organizations are major employers and major sources of employment growth throughout the world. Among the 16 countries examined, nonprofits employ 10 percent or more of the total work force in six of them — the U.S., Israel, Australia, Belgium, New Zealand and Japan — making them one of the largest employers of any industry.

The research shows that, on average, nonprofits employee more workers than either the transportation or construction industry.

"The global nonprofit sector is an enormously important economic actor, as well as a significant source of citizen well-being in countries throughout the world," said Lester Salamon, director of the Johns Hopkins Institute for Policy Studies. "It is time that we recognize more fully the contribution it makes."

In addition to jobs, nonprofits also make a significant contribution to their countries' gross domestic product. The study found that the nonprofit sector accounts for an average of 4.5 percent of the GDP in the countries analyzed, which is about equal to the GDP contribution of the construction industry.

The research discovered that nonprofits receive far less of their revenue from philanthropy than commonly thought. Specifically, just 23 percent of their revenue comes from philanthropic giving, while 43 percent is from fees for their services and 32 percent from government sources.

The study was based on new data from the U.S., Canada, Israel, Mozambique, Belgium, New Zealand, Japan, Australia, France, Norway, Brazil, Kyrgyzstan, Mexico, Portugal, the Czech Republic and Thailand.

Follow Chad Brooks on Twitter @cbrooks76 or BusinessNewsDaily @BNDarticles. We're also on Facebook & Google+.

Chad Brooks

Chad Brooks is a Chicago-based freelance writer who has nearly 15 years experience in the media business. A graduate of Indiana University, he spent nearly a decade as a staff reporter for the Daily Herald in suburban Chicago, covering a wide array of topics including, local and state government, crime, the legal system and education. Following his years at the newspaper Chad worked in public relations, helping promote small businesses throughout the U.S. Follow him on Twitter.

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