Need‐resource indicators and nonprofit human services organization density

Abstract

AbstractThe challenges facing the US nonprofit human services organizations (NHSOs) in securing philanthropic resources and the resulting pressure for increased commercialization are well‐known in the nonprofit literature. However, there is still limited research on how such financial challenges are likely to affect their location choices, particularly in a post‐recession context. Using organizational ecology theory, we conducted a nationwide longitudinal study covering the period of the US 2008 recession to examine whether resource availability is more likely to predict the density of NHSOs than human needs. We used secondary data on a variety of socioeconomic variables from the National Center for Charitable Statistics and the US census survey in a linear multivariate regression analysis. The findings supported a majority of hypotheses, suggesting that NHSOs pursuing earned income are less (versus more) likely to be established in regions where the socioeconomic factors indicate a high (versus low) level of human needs. These findings suggest a counterintuitive trend in the establishment of NHSOs and present cautionary information on pursuing commercial activities in the human services sector.