Nonprofits play a critical role in American society, contributing to social services, community cohesion, religious and civic life, education, health care, and more. The nonprofit sector is essential to our civil society and has a key role in building a nation where all people thrive.
Independent Sector’s 2024 Health of the U.S. Nonprofit Sector: Annual Review, released today, reveals how our sector is faring in a challenging environment. The report summarizes research and analysis on the key areas powering more than 1.8 million U.S. nonprofits: economy and finances, workforce, trust and governance, and public policy advocacy. This year, the news is mixed.
The report shows that Americans trust nonprofits significantly more than any other part of American society, including the military and small businesses. In 2024, trust in nonprofits increased as trust in other sectors fell, suggesting that many people see nonprofits as a port in the storm amid financial insecurity and a divided nation.
The confidence in our sector is heartening, but these are big shoes to fill for workers and organizations who feel like they are teetering on the edge of a cliff. Nonprofits rely on charitable giving to reach people in need, but apart from a 2020 surge in giving related to COVID-19, giving to nonprofit organizations has fallen steadily.
Nonprofits also rely on a strained workforce to complete their work. Groundbreaking research this year found that 22% of nonprofit workers live in households unable to afford basic necessities like housing, food, health care, transportation, and child care. Nearly one-third of workers at social assistance organizations are in this category, meaning many of the people we rely on to help those in need are themselves struggling to make ends meet.
It does not seem our work will be getting easier in 2025. Social and political division remain top of mind for many Americans, as do high costs of living that put some families — including those of some nonprofit workers — in difficult financial positions. A new Congress and presidential administration bring uncertainty in public policy that directly affects our organizations and the communities we serve. Many provisions of the 2017 Tax Cuts and Jobs Act are set to expire in 2025, and how Congress handles tax reform will have major impacts on nonprofit organizations, nonprofit workers, and people in need.
Independent Sector will continue our work to support and strengthen the sector in 2025. We will be deeply involved in making sure the sector’s needs are a key part of tax reform, including pushing for a universal charitable deduction to incentivize giving to nonprofits. We will also continue advocating for a fair policy environment that supports nonprofit work through equitable tax credits, like those for-profit businesses receive to support their workers.
Additionally, we will continue leading research on nonprofit organizations so the sector has the information needed to effectively advocate for itself and others. Next year, we will create a new national survey on the nonprofit workforce to bolster our understanding of the needs of nonprofit workers and organizations. For the sixth year running, we will conduct our national survey on trust in nonprofits and philanthropy. We will also continue strengthening relationships between researchers and practitioners, fostering a two-way flow of information that benefits everyone.
The challenges facing our sector in 2025 are significant, but together we can meet them. Guided by high-quality research and data, we will continue focusing our advocacy where it matters most, working toward policies that strengthen nonprofits, empower their workers, and boost charitable giving. Join us in taking action to strengthen our sector and ensure our communities thrive.
