Nonprofit Newswire | Jobs Bill, Modest Gains for Nonprofits

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February 9, 2010; Washington Insider | An analysis by the combined public policy expert of the United Neighborhood Centers of America and the Alliance for Children and Families suggests that the various jobs bills working their way through Congress as modifications of President Obama’s small business tax credit proposal could help the nonprofit sector modestly. Citing an analysis by the Congressional Budget Office, the Washington Insider blog suggests that the jobs bill will help firms add 80,000 to 180,000 new jobs between 2010 and 2011, of which 8,000 to 18,000 could be jobs in the nonprofit sector. This isn’t huge for the nonprofit sector, though it doesn’t make much of a dent in for-profit employment either (read our analysis here). But the blog suggests that the nonprofit numbers might be a bit low, because of the nonprofit sector’s countercyclical hiring propensity (unlike business hiring which is pro-cyclical), the labor-intensive character of nonprofits, and the likelihood that nonprofits will actually use their tax credits to build their organizations as opposed to businesses’ using the credit for profits and dividends. All told, a tax credit generating only 80,000 total jobs and 8,000 jobs in the nonprofit sector makes hardly a dent in the economy—though it is important to every one of those people who might get one of those scarce new jobs. Strengthening the nonprofit employment base will ultimately require revived federal government direct spending, strengthening the shaky edifices of state and local government budgets, and a big flow of philanthropic capital from the nation’s foundations pledged to bolstering the budgets, salaries, and sustainability of the nation’s 501(c)(3) public charities.—Rick Cohen