United Way of RI: The State of Rhode Island’s Nonprofit Sector, employing 1 in 5

New survey by United Way underscores ongoing challenges facing RI’s nonprofits, critical need for investments in the state’s Human Services infrastructure

Nonprofits are critical economic and workforce engines that employ nearly 1 in 5 Rhode Islanders and are the bacKBOne of countless community programs and services

Newly released survey results of Rhode Island nonprofits paints a concerning picture of the ongoing issues facing the state’s sector and how those issues jeopardize the sustainability of Rhode Island’s human services infrastructure.  A total of 329 Rhode Island nonprofits responded to the survey, with an overwhelming majority indicating workforce staffing, organizational capacity, and community need being higher than pre-pandemic levels as their biggest challenges. It was administered by the Alliance for Nonprofit Impact at United Way of RI and the Grantmakers Council of RI. 

“There isn’t a Rhode Islander whose life is not positively impacted by our nonprofit sector, and so what this survey tells us should worry everyone who lives here,” said Cortney Nicolato, United Way’s president and CEO. “When we talk about the state’s work from a services standpoint, those programs are often being delivered by independent nonprofits, and nonprofits are also the organizations caring for our kids and aging parents, enhancing our arts, culture, recreation and environment, and making our quality of life better.” 

The survey findings demonstrate that Rhode Island’s nonprofit sector is stretched thin as organizations grapple with a tripartite of high demand for services, the end of assistance program funding, and being understaffed and under resourced. While 86 percent of respondents provide direct services, one-third have five or fewer paid staff.

More key findings include: 

65% reported responding to a higher level of community need now, than even during the pandemic.

70% have maintained virtual offerings while also resuming in-person programming, in response to community need

64% were involved in hiring for empty positions in 2023; more than half had vacancies longer than three months

53% named compensation as a primary barrier in filling vacancies

57% of respondents have fewer than 100 individual donors. 

“Nonprofits are Rhode Island’s human services infrastructure, and we need to invest in them in the same way we think about our bridges and roads infrastructure,” said Nancy Wolanski, director of the Alliance for Nonprofit Impact. “We have nonprofits that have not had their state contracts adjusted in a decade, yet continue to provide essential services. For-profit businesses would have to shut their doors if they were expected to sell products at less than they cost to produce, but that is what state contracts ask nonprofits to do on a regular basis. It’s untenable.” 

The survey was conducted late last fall and just prior to the then-impending January launch of the new statewide Alliance for Nonprofit Impact. In a new section of the survey, organizations were asked about the Alliance’s potential programs and services.

Nonprofits were excited about the value of the Alliance’s expected offerings, with large majorities rating them to be valuable: data and research assistance (90%); availability of a year-round, online giving platform (90%); professional and leadership development (89%); and cohort trainings for aspiring leaders (83%).  

“Workforce has been a particularly difficult issue for our nonprofits in recent years and that’s one of the reasons United Way has been at the center of creating the Alliance beginning back in 2021,” added Nicolato. “We talk a lot in Rhode Island about the role small business plays in our economy – it’s time our nonprofits are seen and treated the same way, with equal access to the resources that help them sustain the incredible value they bring to our people and communities.” 

Along with the social good that Rhode Island nonprofits generate, the sector is a significant percentage of the state’s workforce – larger than manufacturing. Nearly 1 in 5 workers in the Ocean State is employed by a nonprofit, and the sector as a whole is responsible for more than $4 billion in annual wages.  However, a majority of responding organizations pointed to higher salaries in the private sector, salaries incommensurate to the scope of the position, and a lack of qualified workers in the state as contributing most to their hiring challenges.

The positions identified as the most difficult to fill were clinical positions requiring specialized degrees, direct service professionals, those related to child, youth, and Education, and finance and fundraising. Due to limited resources, 23% reported paying entry level staff less than $15.50/hour, meaning some nonprofit workers may qualify for government assistance programs despite being employed. Fewer than half of responding organizations offer retirement benefits, while 62% offer medical benefits and 60% offer dental coverage.  

“Nonprofits are essential to our economy, the well-being of our communities, and the delivery of public sector programs and services. And yet, the data in this survey shows we have to do a far better job of getting them the resources necessary to do their important work,” finished Wolanski. “Thousands of Rhode Islanders are counting on these organizations – we need to make sure they have what they need, so they are there when we need them.”