Does the Next Generation Need to Work at Nonprofits?

Late in 2020, Oxford University Careers Service team created a series for its students. One of the topics of discussion was about entering the fundraising profession. Ultimately, that got me wondering whether the next generation — Millennials and Generation Z — needs to go into the nonprofit industry to make a social impact. Moreover, is it necessary to go into the nonprofit sector, which may in time cause a drain in the industry?

National State of Nonprofit Employment

As we know, probably the most significant story of 2020 and 2021 is the pandemic. And, of course, the challenges stemming from it caused economic challenges for people. As of this writing, overall job hiring numbers slowed. The Center for Civil Society Studies at Johns Hopkins University reported that the industry recovered some of the 1.64 million nonprofit jobs lost in 2020.

As noted in their reporting, “ … over the full recovery period (i.e., June 2020-August 2021), nonprofits have recovered a combined 65.6% of the estimated 1.64 million jobs lost during the first three months of the pandemic.” Still, nonprofit jobs, including people (e.g., doctors and nurses) working in nonprofit hospitals, universities, and institutions, have more recovering.

The reality is that the nonprofit sector is a significant employer in the United States. In 2017, it employed more people than every other sector except for manufacturing and professional services. However, like many people, including me, have said, the nonprofit sector is changing.

For-Profits Entering into the Social Good Space

For the 20th Century, the idea of philanthropy was limited to nonprofits. Of course, that’s a generalization, but an accurate one nonetheless. Sure, cause-related marketing existed, as did corporate social responsibility. Still, when you asked people about making a social impact, the first type of organization most people associated with that idea was a nonprofit.

That's changing. For instance, as we know, the financial industry wants to make and increase profits. And one of the places they know they find financial gains is in the medical industry. That's why you have many nursing homes and hospitals now financed heavily by private equity firms.

Moreover, there's distrust in institutions by the public, and yes, that includes the nonprofit sector. Some of the primary reasons that nonprofits' mistrust exists are perceived financial mismanagement, self-enrichment by founders, systemic bias in the industry, and a lack of strategic investment and competence. Also, because the vast majority of nonprofits operate with small budgets, the question remains, can they make a scalable impact for the people they serve or are many simply providing a band-aid?

Corporations Spot an Opportunity

None of what I describe is a secret, and it's been a topic of discussion for decades in the industry. People want to see an end to the challenges of bias, inequality, poverty, education, healthcare, etc. And that's especially true at a time of unprecedented wealth, technology, knowledge, and globalization.

Of course, corporations spotted an opportunity. As a result, more companies started to shift and incorporate social good into their business planning. Some years ago, the Business Roundtable moved away from the singular focus on profits to include placing customers first, as well as their employees and communities. Furthermore, they aimed to ensure they dealt equitably with vendors and decided to focus on the environment.

Let's face it, corporations and businesses exist to make money and profits. And because younger generations care about the collective and social good—and they can much more easily activate social activism with digital and social media—corporations understood that to grow and retain Millennial and Generation Z customers, they had to do more about making an impact.

And that’s why you now see corporations taking positions on social justice. In fact, Harvard Business Review published a piece about corporate social justice, which is where we find ourselves today. As stated, corporate social justice reframes corporate social responsibility and ups the ante on corporations that largely remained in the background concerning social issues. Most importantly, “Corporate Social Justice requires deep integration with every aspect of the way a company functions.”

A Redefinition of Careers in the Social Good Sector

I try to avoid using the "nonprofit sector" when I speak or write. In my mind, the idea of philanthropy and making a social impact expanded in the 21st Century. I predict that we’ll see an increase in for-profit social enterprises making an impact. And as more corporations align their business plans and take a stand on social issues, more significant work opportunities exist for workers.

Essentially, during the 20th Century, if people wanted to make a social impact, they entered nonprofit careers early or mid-career. However, that’s no longer the only approach to jobs in social good. Now, people inclined to make an impact, especially the younger generations, could enter into for-profit careers geared toward social good.

Workers could move into the CSR or foundation areas of for-profit companies. They could establish or work in for-profit social enterprises. Also, they could work in marketing teams of corporations, which often handle promoting partnerships with nonprofits. Remember, indirectly working to promote a worthy cause is still crucial because high-quality organizations need brand awareness and fundraising dollars.

In sum, the most important takeaway is for people seeking to enter the social good sector to know they don't have to work at a nonprofit to make a difference. They have many creative opportunities within corporations, social enterprises, and developing their own small business and actively engaging in philanthropy.