COVID-19 took a toll on nonprofit employment in the nine-county Indianapolis Economic Growth Region (EGR 5), but the years that followed told a story of recovery and resilience, according to a new report on COVID-19 employment losses in the Indianapolis-area nonprofit sector from the Indiana Nonprofits Project, which analyzed data on paid employment from 2018 through 2023 as well as some preliminary data from 2024.

The report on COVID-19 employment losses for Indianapolis-area nonprofits highlights the long-term impact that the COVID-19 pandemic imposed on nonprofit employment, payroll, and wages in the Indianapolis economic region between 2018 and 2023. Total nonprofit employment in the region declined by 5% in 2020 for the first time since 1995, when the project launched its data series. The study focuses on five major nonprofit industries and subindustries in health care, education, social assistance, arts, entertainment, and recreation (AER), and membership associations.

The immediate impact of COVID-19 on paid employment in 2020 was uneven across these key nonprofit industries. With the temporary closure of non-essential services at the height of the pandemic, the AER industry absorbed the most dramatic impact, while health care—where essential services such as hospitals and ambulatory care were indispensable–had virtually no employment losses.

“The arrival of COVID-19 in early 2020 presented major challenges for families, communities, government and service providers everywhere, including Indiana nonprofits,” said Dr. Kirsten Grønbjerg, Director of the Indiana Nonprofits Project. “We know from our previous reports that nonprofits had to change service delivery formats and lost funding while still trying to meet the rising needs of communities.

“Massive federal pandemic relief efforts enacted in 2020-2021 softened the blow, but as nonprofits had to cut costs, our new findings suggest they selectively retained higher paid, skilled staff in their attempts to keep programs operating.”

The post-pandemic recovery for the region’s nonprofits was slow. Total nonprofit employment did not completely recover to 2019 levels until 2022, with preliminary data showing continued growth in 2024. However, the recovery was uneven across the key nonprofit industries, and nonprofits recovered more slowly than did for-profits in most of these industries.

Read the full article about nonprofit recovery in the Indianapolis region at Lilly Family School of Philanthropy.