The news about furloughs at Perseverance Theatre isn’t good, especially for the employees who will be missing out on regular paychecks. The possibility the theater will be forced to shut down is more troublesome. Just like the closure of any small business, it hurts the local economy. But because Perseverance is a nonprofit, to understand the ripple it could send through the community requires we expand the modern-day meaning of profit.
The place to start is a report titled “Alaska’s Nonprofit Sector: Generating Economic Impact” that was published by The Foraker Group earlier this year. The authors noted that when the state tracks jobs, it places workers from nonprofit organizations into traditionally defined industries. But there’s no complimentary analysis of whether the work and employment originate in the private, governmental or nonprofit sector.
So Foraker grouped all nonprofits in its own sector and compared them with the entire private sector and government employment. Some of the results were startling.
In 2015, there were almost 5,800 nonprofits operating in Alaska. They generated $7 billion in revenue. The 44,000 Alaskans working for them earned $3.9 billion in income. And they indirectly helped sustain another 23,000 jobs.
On a percentage basis, these figures are well above the national average.
Overall, health care is largest nonprofit industry in Alaska. It accounts for a third of the sector’s revenue. About half of all Alaskans employed in health care work for nonprofits.
One reason why people might choose to work at nonprofits is related to job opportunities. For instance, in western Alaska rural communities, 40 percent of all workers are employed at nonprofits probably because that’s where the jobs are. Another reason is that nonprofit wage and salaries is slightly higher than the private sector. And for some people it’s about working in a field devoted to the welfare of others.
Where does Perseverance fits into this picture? They’d be grouped under arts, entertainment and recreation which have very small supporting roles from the economic side. But it brings value to the community that money can’t measure. And that’s where I think we need to revive the earliest meaning of profit.
Merriam-Webster’s offers six different definitions for the word. Five relate to finances. The first — “a valuable return or gain” — doesn’t. Its origins date to the 14th century Latin word “proficere” meaning to “accomplish, make progress; be useful, do good.”
Using that definition, Perseverance and every one of the 5,800 organizations in Alaska are profitable. But unlike a small business that moves its profit into a private bank account, or a corporation that shares it with stockholders, the abstract value gained by nonprofits primarily reaches into the community. Indeed, that they do good for others is their primary reward.
Look again at the health care industry. If a person gets good treatment for a troubling ailment, then in non-monetary terms, he or she benefits much more than the providers. And the personal health dividends could continue well into the future even if the doctor doesn’t remember the patient a year or so afterwards.
The same is true for stage or film. A theater-goer pays an admission fee. If it’s a good show, the money is considered well spent. But if it’s an exceptionally entertaining or thought-provoking production, then the benefit gained by the customer takes on a life independent of money taken out of the wallet or bank account.
In both examples, it doesn’t matter if the organization offering the service is for profit or not. The non-monetary profit is shared by members of the community. We can simply that three-pronged term by referring all value gained as profit.
As Foraker states near the end of its report, “Alaska’s nonprofits are true contributors to Alaska’s quality of life, our health, and our economy.” Economy here takes a back seat to the other values. As it should, because the term nonprofit didn’t exist until a hundred years ago when a distinction became necessary for corporate and tax laws.
As for Perseverance, if it closes, a lot more will be lost than the jobs and revenue that have a positive impact on Juneau’s economy. It put on wonderful plays enjoyed by thousands the past 40 years. Let’s hope it can give us many more.
• Rich Moniak is a Juneau resident and retired civil engineer with more than 25 years of experience working in the public sector. He contributes a regular “My Turn” to the Juneau Empire. My Turns and Letters to the Editor represent the view of the author, not the view of the Juneau Empire.
