Indiana UniversityIndiana University
Choose site to be searched
Type search terms

Indiana Nonprofit Employment:
Trends in Education, 1995-2009

Nonprofit Employment Report #5
May 2012 (Revised June 2012)
Kirsten A. Grønbjerg, Project Director
Kellie L. McGiverin-Bohan, Kristen Dmytryk, Katherine Gagnon,
and Katherine Novakoski, with Jacob Knight and Virginia Simpson

A Joint Product of the Center on Philanthropy at Indiana University, the School of Public and Environmental Affairs at Indiana University, the Indiana Business Research Center at Indiana University's Kelley School of Business, and the Johns Hopkins Center for Civil Society Studies


Click to read the press release for this study, a short summary or the full report. Note: the full report is a large file (7 MB) and you will need a free copy of Adobe Reader program to read the documents.

Introduction

Nonprofit organizations make significant contributions to the quality of life for the residents of Indiana by offering education and job training, access to arts and culture, social assistance, health care, and opportunities for civic engagement. They are also a major force in the state’s economy and in the economic health of all regions of the state.

This report presents new information on the size, composition, and distribution of paid nonprofit employment in Indiana’s education industry. The fifth report in a series of statewide employment analyses, it focuses on trends in nonprofit education employment from 1995 through 2009. Data over this time period give us insights into how recessions and economic growth periods impact private nonprofit employment in this industry. 

Key Findings

Our report provides detailed analysis of major changes in nonprofit employment and wages in the education industry from 1995 through 2009 with comparisons to corresponding trends in public and for-profit educational establishments. Our analysis also includes trends in major education sub-industries: colleges and universities, junior colleges, elementary and secondary schools, and other types of educational establishments.

Overall Education Employment

  • Nonprofit employment in education increased faster than employment in other major nonprofit industries. From 1995 to 2009, total nonprofit employment in education grew by nearly 50 percent. In comparison, nonprofit employment in health care and social assistance grew 35 and 44 percent, respectively.
  • In 2001, the education industry surpassed membership organizations to become the second largest employer of nonprofit workers. About 12 to 13 percent of all nonprofit workers were employed by educational institutions. The number one nonprofit industry, health care, accounted for over 50 percent of nonprofit workers.
  • Nonprofit employment in education grew more than employment in governmental education establishments – up by 50 percent from 1995 to 2009, compared to only 25 percent growth for government education over this same time period (the latter includes state universities, such as Indiana and Purdue universities, and public elementary and secondary schools).
  • Total nonprofit payroll in education grew over 70 percent over the same time period (adjusted for inflation), fueled mainly by growth in college and university payroll (up 66 percent from 1995 to 2009).
  • The average size of nonprofit education establishments decreased 20 percent. This is likely due to the formation of new smaller education establishments, rather than employment reductions in older establishments. The average size of government establishments grew slightly over the same time period.
  • Nonprofit average annual wages in education increased by 15 percent between 1995 and 2009, after adjusting for inflation. This growth outpaced that of nonprofit average annual wages in the social assistance and arts, entertainment, and recreation industries, which saw growth of 11 percent and 7 percent, respectively.
  • Nonprofit and for-profit educational institutions are very different from one another. Nonprofit institutions resemble government educational institutions more than for-profit ones.The latter tend to be much smaller and display much more volatility than their nonprofit peers.

Colleges and Universities

  • Nonprofits employed about a third of college and university workers in Indiana. Overall, nonprofit employment in this sub-industry increased by 43 percent from 1995 to 2009, while government employment (i.e., in public universities) only increased 23 percent. 
  • Nonprofit (i.e., private) college and university establishments significantly outnumber government (i.e., public) or for-profit establishments. Over the 15 year time period, the nonprofit sector dominated college and university establishments, ranging from a high of 67 percent in 1995 to a low of 57 percent in 2008. However, nonprofit establishment are much smaller than their government counterparts with only one-fifth the number of employees compared to the average government establishment. 
  • Average wages in nonprofit colleges and universities increased 16 percent (adjusted for inflation). Wages in public colleges and universities grew only 5 percent.

Elementary and Secondary Schools

  • Nonprofit employment in elementary and secondary schools grew 58 percent from 1995 to 2009. This might be due to increased interest in private and charter school education in the state. In comparison, government employment increased 24 percent.
  • In nonprofit elementary and secondary schools, the average annual wage increased 20 percent from 1995 to 2009. Average wages in public schools and institutions dropped 8 percent over the same time period (all adjusted for inflation).
  • The average nonprofit elementary or secondary school had between 60 and 80 workers. In comparison, public schools had between 100 and 115 employees. The average size of for-profit schools peaked at about 70 employees in 1999, but has remained at 30 or fewer employees since 2001.

Junior Colleges

  • Trends suggest that nonprofit employment in junior colleges decreases when for-profit employment increases. In particular, the number of for-profit junior college employees increased from 2004 to 2009 while nonprofit employment decreased.
  • Nonprofit junior college average annual wages were more volatile than government average wages but less volatile than for-profit wages between 1995 and 2009. Yearly changes in nonprofit wages (adjusted for inflation) were as high as 12 percent from one year to the next, with the greatest annual changes occurring between 1995 and 2003.
  • The nonprofit sector comprised a small and decreasing number of junior colleges between 1995 and 2009. From 1995 to 2006, nonprofit junior colleges accounted for 18 to 21 percent of all junior colleges, but this percentage dropped dramatically from 2007 to 2009. This is might be due to the reclassification of one junior college (and all its campuses) into a four-year school.

Methodology

The report draws on data generated by the Indiana Department of Workforce Development through surveys of Indiana workplaces carried out under the national Covered Employment and Wages (CEW) labor market information program administered by the U.S. Bureau of Labor Statistics as part of the unemployment insurance program. These data, compiled from quarterly reports submitted by employers in compliance with U.S. and Indiana law, were prepared for us by the Indiana Business Research Center at Indiana University's Kelley School of Business under a confidentiality agreement with the state.

For information about the methodology used in this report and for additional tables, please see the Appendices at the bottom of this page. Reports on nonprofit employment for other states are available at Center for Civil Society Studies at Johns Hopkins University.

Appendices

Our report includes several appendices with supplementary information. They include:

  • Appendix A: The ES-202 Unemployment Insurance Labor Market Information Program - Sources of data, scope of coverage, and data processing and cleaning.
  • Appendix B: Data Tables - Nonprofit employment and wages in edication and education subindustries.
  • Appendix C: Project Publications and Reports

Acknowledgements

This report was prepared as part of an ongoing project from the Indiana Nonprofits: Scope and Community Dimensions project made possible by the Efroymson Fund at the Indianapolis Foundation (an affiliate of the Central Indiana Community Foundation) through its support for the Efroymson Chair in Philanthropy; the Indiana University Center on Philanthropy through its Indiana Research Fund (supported in part by Lilly Endowment Inc.) and its ongoing support for the Efroymson Chair in Philanthropy; and the School of Public and Environmental Affairs at Indiana University through its ongoing support for the Efroymson Chair in Philanthropy.

We are grateful to Carol O. Rogers, Victoria Nelson, and Jerry Conover at the Indiana Business Research Center at Indiana University's Kelley School of Business for making the data on which this report is based available to us and for very helpful comments on the draft. We also thank Kerry S. Brock for her help in preparing the basic framework for our analysis and Alexandra Buck and Weston Merrick for their help in finalizing the analysis. Finally, we thank members of the Advisory Board for the Indiana Nonprofits: Scope and Community Dimensions project for helpful comments and suggestions.