Nonprofits produce big economic benefits, Boys & Girls Clubs study shows
By Doreen Hemlock, SunSentinel April 30, 2013
Nonprofits tend to be seen as social do-gooders but are often overlooked as economic drivers.
A new study from the Boys & Girls Clubs of Broward County challenges that view.
The research finds that the nonprofit generates more than $18 in economic impact for every $1 it spends – or more than $180 million in economic benefits yearly.
The Broward group serves more than 12,000 youth and their families at its 12 centers yearly, including thousands of children who end each school day with supervised activities at the centers.
Its services allow parents to work longer hours or attend school to upgrade their skills, earning more than they would if they were home with their children, the research found.
In addition, youth who regularly attend the clubs are more likely to graduate from high school on time and less likely to engage in risky behaviors such as crime. They are also more likely to generate higher incomes over their lifetimes and cost society less, the report said.
Damooei Global Research, led by an economics professor at California Lutheran University, placed dollar values on those benefits as follows:
More earning power by parents of children attending clubs: $12.70 benefit for every $1 spent.
Better education and improved lifetime earnings for children who regularly attend clubs: $1.86 benefit for every $1 spent.
Lower teen pregnancy and motherhood rates: 12 cents savings for every $1 spent.
Lower crime rates and related savings: 84 cents savings for every $2 spent.
Reduction in risky behaviors such as smoking, drinking, drug abuse: $1.03 for every $1 spent.
Direct employment, construction and volunteer work: $1.90 in benefit for every $1 spent.
The Boys & Girls Clubs of Broward employs 200 people full time or part time and mobilizes about 500 volunteers annually. It operates with a $9.8 million budget this year.
Multiply that budget by $18.45 for every $1 spent, and that's $183 million in economic impact from the clubs this year alone, said Brian Quail, chief executive at the nonprofit.
"To quantify our economic impact is huge when we talk to donors or funders," said Quail, noting investors want to know their cash generates a positive return.
Quail said he was especially heartened by the impact of child supervision on income for working parents. Roughly 57 percent of club members in Broward come from single-parent homes.
"When employees don't have to worry about leaving work early to care for their children or having children home alone, they can be more focused on their work and more productive," said Quail.
Nationwide, nonprofits account for about 5 percent of the economy and 10 percent of jobs, according to the National Center for Charitable Statistics.
Some nonprofits in South Florida also have quantified their economic impact, using varied methodologies. Among results of their recent studies:
Broward College estimates its economic impact at roughly $1 billion a year, mainly from helping boost the earnings of its students, according to a study by Economic Modeling Specialists of Idaho. The study looked at the college in the 2010-2011 school year, when it had $277 million in revenue, employed 3,525 full-time and part-time faculty and staff, and enrolled 64,102 credit and 3,546 non-credit students.
Florida Atlantic University last year estimated its economic impact at about $4 billion per year in its six-county service area — or what FAU called the equivalent of seven Fort Lauderdale boat shows. The school has an operating budget topping $600 million, more than 2,700 employees and more than 1,500 faculty members.
Nova Southeastern University estimates a $1.7 billion economic impact in the tri-county area and a $2.6 billion impact in Florida. It employs about 4,000 people and educates about 27,000 students per year.
The Community Foundation of Broward, involved in a School is Cool program, cites studies that estimate a return of $1.45 to $3.55 for every $1 invested in ensuring a student graduates high school.
Henderson Behavioral Health of South Florida estimates every $1 invested in adult community mental health services saves $3.71 in hospital, crisis unit and incarceration expenses, based on data from the Florida Council for Behavioral Health Care.