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The newspaper of The Johns Hopkins University October 1, 2007 | Vol. 37 No. 5
Nonprofit Contribution to GDP Enormous, New Study Reports

Official data from eight countries reveals sizable economic role

By Mimi Bilzor
Institute for Policy Studies

The civil society sector contributes about as much to gross domestic product in a wide range of countries as do the construction and finance industries and twice as much as the utilities industry, according to a Johns Hopkins report released last week at the first Global Assembly on Measuring Civil Society and Volunteering, held in Bonn, Germany.

These findings emerge from data generated by official statistical agencies in eight countries that are the first to implement new guidelines contained in the U.N. Handbook on Nonprofit Institutions, which was issued by the U.N. Statistical Division in 2003. These guidelines call on statistical agencies, for the first time, to pull together data on nonprofit institutions that up to now have been scattered in official statistics, and to estimate as well the value of volunteer work.

"We now have an officially sanctioned method for capturing the economic scale and importance of civil society and volunteering around the world, and what it is revealing is that this set of organizations is far more important than we have realized," noted Lester Salamon, report author and director of the Johns Hopkins Center for Civil Society Studies, which helped the United Nations draft the handbook and has been involved in promoting its implementation.

According to the report, the civil society sector — comprising private not-for-profit hospitals, schools, social service agencies, symphonies, environmental groups and many other organizations — accounts on average for 5 percent of GDP in the countries covered, and exceeds 7 percent in some countries, such as Canada and the United States. By comparison, the utilities industry — including gas, water and electricity — in these same countries accounts on average for only 2.3 percent of GDP, the construction industry for 5.1 percent and the financial intermediation industry — embracing banks, insurance companies and financial services firms — for 5.6 percent.

Other findings in this report, which covers Australia, Belgium, Canada, the Czech Republic, France, Japan, New Zealand and the United States, include the following:

For the five countries on which historical data are available (Belgium, Canada, the Czech Republic, Japan and the United States), nonprofit institutions have recently been growing at an average rate that is twice the growth rate of GDP (8.1 percent per year vs. 4.1 percent).

Nonprofits account for the lion's share of value added in many critical human service fields. In Belgium, for example, they provide more than 40 percent of the value added in health and more than two-thirds of the value added in social services.

Health and education account on average for 60 percent of the economic contribution of nonprofit institutions, though this figure varies widely by country.

Philanthropy, including volunteering, generates at most only about one-third of nonprofit revenue. The balance comes from government and fees.

Within philanthropy, gifts of time (i.e., volunteering) outdistance gifts of cash by almost two to one.

Volunteer work accounts on average for about 25 percent of the economic contribution of nonprofit institutions, though this reaches 50 percent in New Zealand.

The meeting at which this report was released was the first official gathering of statistical offices involved in implementing the new U.N. Handbook on Nonprofit Institutions around the world. Held at the U.N. offices in Bonn, the assembly was organized by the Center for Civil Society Studies at the Johns Hopkins Institute for Policy Studies in cooperation with U.N. Volunteers and the U.N. Statistics Division.

In addition to the eight countries that have already issued the NPI Satellite Accounts called for in the handbook, 20 more countries, both developed and developing, have committed to doing so, and a number of others are about to begin implementation. The result will boost significantly the visibility and credibility of this set of institutions and permit more coherent public and private policies towards them.

The full text of the report, "Measuring Civil Society and Volunteering: Initial Findings from Implementation of the U.N. Handbook on Nonprofit Institutions," is available at Printed copies can be purchased for a small fee by e-mailing


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