Blog: Kyle Caldwell

How do nonprofits weather the state's economic storm? Funny you should ask. Kyle Caldwell is the President and CEO of the Michigan Nonprofit Association. He's also served both Governors Engler and Granholm as the Executive Director of the Michigan Community Service Commission. Kyle will be writing about the economic impact of Michigan's nonprofit sector and its struggle with the downturn.

Kyle Caldwell - Post 5: Economic Impact of the Nonprofit Sector

This week we took a look at the nonprofit sector as a vital resource to Michigan’s economy. We discussed some of the hardships nonprofits are expected to face during the troubled economic times, but we also discussed how nonprofits can respond by working together to create strategic plans of sustainability and how the community can work together in support of nonprofits. 

The nonprofit sector is very broad in scope, with more than 47,000 nonprofit organizations promoting human services, health care, arts and culture, the environment and education.We’ve seen a 14 percent increase in total nonprofit organizations since 2001. Our nonprofits, especially charities, range from universities and hospitals to local soup kitchens and literacy coalitions. 

Nonprofit charities are referred to as a "safety net" providing valuable services to the community, working with every issue of concern, yet many do not understand the true impact nonprofits make to the state’s overall vitality and success.

The Michigan Nonprofit Research Program will soon release the 2008 Economic Benefits of Michigan’s Nonprofit Sector report, which will show the true breadth of the nonprofit sector. We are considered the fifth largest industry in terms of employment in the state, with one in every ten jobs in Michigan tied to the nonprofit sector. Most Michigan residents have worked with, volunteered for and been served by a nonprofit since nonprofits can be found in every subsector of the service economy, including a strong presence in health care, human services, education and the arts.

A third of the study’s reporting nonprofits are based in the six county metro Detroit region and those organizations account for just over half of the state’s nonprofit assets, expenditures and revenue. The people of Detroit are feeling and seeing the results of this economic crisis every day, but nonprofits continue to push even as demand rises and resources shrink. 

Here are a few examples: 

  • The Art of Leadership Foundation focuses on helping children succeed in school in Detroit, and was able to help all of its two classes of students graduate from their program, obtain high school degrees and continue on to higher education institutions – that’s 100% completion.
  • Accounting Aid Society was recently named “Best-Managed Nonprofit” by Crain’s Detroit Business for eliminating its deficit, increasing services and increasing the number of prepared tax returns by 50 percent.
  • Seedlings Braille Books for Children continues to provide the gift of reading not only in Southeast Michigan, but across the world, with more than 900 titles produced since 1984.

How will nonprofits respond to the economic downturn? We’ll do what we do best. Change and adapt to continue to provide services to the community. This does not mean that it will be business as usual. The urgency and expanding scope of needs will overwhelm the current capacities, requiring that nonprofits cut costs and create efficiencies through strategic alliances, partnerships and mergers. But make no mistake, we will not cut or merger our way to success. 

Nonprofits will also have to find new ways to fund operations by developing relationships with individuals as well as institutions. We will need to increase transparency and accountability. While we are in an economic downturn, nonprofits will continue to serve, strengthen and transform communities – just differently than we have in the past.

If you would like to receive the complete 2008 Economic Benefits of Michigan’s Nonprofit Sector when it becomes available, please email