It might be time to retire the term “third sector.”
In importance to the Rochester-area economy, non-profits today are second to none. Indeed, measured by employment and the rate of jobs created, these businesses have taken on the leading role.
Look at this week’s RBJ 75 supplement, which ranks the largest employers in the six-county Rochester region, to see how much the local economy has changed since the days of the Big Three—Eastman Kodak Co., Xerox Corp. and Bausch & Lomb Inc. Today, five of the top 10 employers are non-profits.
The clear leader, of course, is the University of Rochester. Twenty-five years ago, Kodak employed 44,000 people in Rochester and UR had roughly 8,400 on its payroll. Now, the university’s total staff exceeds 25,000, including roughly 22,500 full-time equivalents; post-bankruptcy Kodak employs 2,300.
And UR continues to grow. In the past year, it added 399 full-time equivalents and 570 staffers overall. No other employer among the RBJ 75 matched that.
Jobs are one yardstick—the most significant one, many would argue. But UR’s impact on the local economy can be measured in other ways as well. A recent report from the Center for Governmental Research Inc. highlighted UR’s economic role. It generates more than $2.8 billion in total wages and spends nearly $200 million annually on goods and services purchased locally.
The university also has spent nearly $250 million annually on capital improvements over the past five years, and it draws millions more to this area through research grants and other funding.
The big economic engine is the University of Rochester Medical Center, which accounts for some 83 percent of UR’s cash flow and alone employs more than 17,311 people—up from roughly 11,650 in 2000. Since then, URMC’s total revenues have doubled.
Some people are troubled that non-profits in some respects have eclipsed manufacturing firms. What really matters, though, is the potential for sustainable growth.
With UR, the newly formed Rochester Regional Health System and other knowledge-driven non-profits at the heart of the area’s new economy, there seems to be ample reason for optimism.
7/25/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email email@example.com.