Nonprofit Organizations in the Local Economy

9, 10, 11, 12

All too often when one looks at the local economy, the role of nonprofit organizations is overlooked. This lesson will focus on their role both in the local economy and, to a lesser degree, internationally.

PrintThree Fifty-Minute Class Periods

The learner will:

  • categorize the types of nonprofit organizations in the local economy.
  • evaluate the role of nonprofit organizations in the local economy.
  • analyze the impact of local nonprofit organizations in the international sphere.
  • Nonprofit Organizations in the Local Economy (Attachment One)
  • Nonprofits in Specialized Areas in the Local Economy (Attachment Two)


  1. Write the following categories on the board:

    • Arts, culture and humanities
    • Education and research
    • Environment and Animals
    • Health
    • Human Services
    • International
    • Public, Societal Benefit
    • Religion

      Now have students repeat their responses, but this time place them under their appropriate category. (If necessary, go over the categories to make sure students understand them.) Notice if any categories are blank or have few responses in them. Why is this? Do students believe that the items they listed under the categories are a good representation of their community?

    • Explain that each of the categories listed above represents portions of the local economy. There are organizations and institutions in each category that hire employees, purchase consumer goods and services, pay taxes and influence others. Ask students to name familiar organizations in the community which belong in each of the categories. Ask students to describe the economic impact of these organizations. If some of them didn't exist, would there be economic hardship on some of the city's residents?
    • Notice if any of the answers were examples of nonprofit organizations (see Lesson One: How Should I Begin? for examples). Split the class into teams of two or three and ask teams to name one or two local nonprofit organizations in each category. After a few minutes have teams report Again ask students to describe the economic impact of these organizations on the local community. If some of them didn't exist, would there be economic hardship on some of the city's residents?
    • Divide the class into eight teams. Distribute Nonprofit Organizations in the Local Economy (see Attachment One) to each team. Assign one of the categories mentioned above to each team. Go over the directions and allow time for students to complete their sheet. When teams have finished, allow sufficient time for them to report on the organizations they selected and explain why they chose the organizations they included on the chart. They should explain the economic importance to the local economy of their selections. Ask if there were organizations not selected but were still considered to be important.
    • Keeping the same teams and categories, distribute Nonprofits in Specialized Areas in the Local Economy (Attachment Two). Using again, tell students to find out the number of organizations in each income range for their category. Fill in the chart. Compute the percentage of organizations in each income category and display this information in a pie chart or graph. Go to the highest income category and list every organization in it with total assets included.
    • Discuss the range and number of organizations in each category. Decide whether or not the income range is any indicator of each organization's importance to the community, both economically and socially.
    • Ask the team that researched local nonprofit organizations with "international ties" to give their report orally to the entire class. After they have done so, pose the following questions for the class' consideration:
    • Does our community have any nonprofit organization which plays a role internationally?
    • If so, what kind of work does it do and what kinds of resources does it commit to its work?
    • Is this organization recognized in the community and supported? If not, why not?
    • Does our community have a branch of an international nonprofit organization (e.g., Red Cross or a religious group)? If it participates internationally, is its international work recognized in the community?
    • In conclusion, do our nonprofit organizations have an important role internationally?

Students should have been able to form generalizations about the importance of nonprofit organizations to the economic well-being of their community. They should also realize that there is or is not an international link to the world through local nonprofits. In an essay of one to two pages, each student should answer the following questions: Are nonprofit organizations important to the well-being of this community? Does an organization's income level reflect its importance to the local community? Do the nonprofit organizations in this community have an international role? Rubric Points Description 4 The completed paper clearly answers all three required questions. 3 One of the required answers is not provided. 2 Two of the required answers are not provided. 1 The writer is not clear in the responses or can't reach a conclusion on the issues. 0 No attempt was made to complete the task.

Philanthropy Framework

  1. Strand PHIL.I Definitions of Philanthropy
    1. Standard DP 02. Roles of Government, Business, and Philanthropy
      1. Benchmark HS.3 Identify an example of failure in each sector, and how the other sectors modified their roles in response.
      2. Benchmark HS.7 Describe how the civil society sector provides mediation for individuals and governments.
  2. Strand PHIL.II Philanthropy and Civil Society
    1. Standard PCS 03. Philanthropy and Economics
      1. Benchmark HS.11 Analyze the impact of volunteerism on the economy of communities.