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Summit Scans Economic Landscape for Nonprofits

Texas will continue to outperform the nation, but the sub-par performance of the U.S. economy, long-term unemployment and a steady stream of people moving to Texas suggest the demand for nonprofit services will remain high, according to Economist Dr. Bernard “Bud” Weinstein of the SMU Cox School of Business.

He was one of four experts at the February 13 United Way Economic Summit for Nonprofits who offered perspectives on the economy and its implications for nonprofits and the people they serve. The event at the Tarrant County College Trinity River Campus was co-sponsored by the Community Foundation of North Texas.

Trending Upward

U.S. retail sales, construction spending, housing starts and home sales have been trending upward over the last 18 months, Dr. Weinstein said. He noted that the Dallas/Fort Worth area was the major market least affected by the housing bust to begin with. “We weren’t recession proof, but we’ve done a lot better than the rest of the country,” he said. The relatively strong economies of Texas and the DFW area may mean that fundraising here will be easier for nonprofits than in many other parts of the nation, he said.

While the nation’s unemployment rate has come down, Dr. Weinstein said a lot of the decline is due to people who have stopped looking for work. “There may be a whole generation of displaced workers,” he said.

Economic Development

Economic development is one antidote for unemployment, and Lisa McMillan, Economic Development Coordinator for Tarrant County, said the county is enjoying new construction and investment. Total appraised value in the county increased from $147.7 billion in 2010 to $158.2 billion in 2013. Tarrant County unemployment is 5.3 percent; lower than the state and national figures.

“The health of the community is something businesses look at when they relocate,” she said. At the same time, when businesses seek a tax abatement, “We ask what health care and benefits they provide employees,” she said. “We want them to be a good corporate partner.” She thinks that, as the economy continues to improve, companies will offer better benefits and people won’t need to access nonprofit services as much. “Volunteering and giving should increase as people feel more secure in their jobs,” she added.

Community Outlook

Emily Ryder, Community Development Analyst with the Federal Reserve Bank of Dallas, shared insights from a recent survey of community-based organizations that serve low- and moderate-income families in Texas and parts of Louisiana and New Mexico. During the last half of 2013, about a quarter of the respondents said financial well-being had improved among low- and moderate-income families. Almost half of the service providers believed the availability of jobs had improved, and a majority said they expect job availability to increase in 2014.

Only 1 in 10 service providers had observed greater availability of affordable housing, and only 9 percent had seen improved access to credit. As for the organizations themselves, they pointed most often to the lack of grant funding and governmental funding as factors affecting their own financial sustainability.

Emily also provided results of a recent survey of Texas small businesses. Almost half of the 754 respondents were in the services business sector. The respondents said it was most difficult to find workers with sales and marketing skills, advanced technology and computer skills, punctuality/reliability, and interpersonal skills.

A Better Future

Ann Beeson, Executive Director of the Center for Public Policy Priorities in Austin, said the economy is growing in Texas but is not having the positive effect needed “to get to a better future” for all Texans. “If the economy is doing so well, we ought to be able to pay a living wage to workers in Texas,” she said. “There’s no reason why we can’t restore funds for education all across the state.”

Texas has one of the highest rates of income inequality in the country, she said, and ranks last among the states when it comes to adults who have a high school education or health insurance. In Tarrant County, there are more children in preschool now, and the high school drop-out rate has gone down during the last 10 years. At the same time, she said, there has been a 63 percent rise in childhood poverty. “It takes $47,000 a year to make ends meet in Tarrant County, and that’s without saving,” she said. “And 22 percent of the families in Tarrant County don’t make that much.”

Ann urged nonprofit service providers to “come together” and work with each other and with their stakeholders to educate and advocate for positive public policy change. “We live in a prosperous state. We have the wealth and the skills,” she said. “We can fix this, and we must.”