When reporting the resources available for a nonprofit organization, one essential resource is commonly left out: volunteers.
A study by Independent Sector, a coalition of nonprofits, reports that one hour of volunteering is worth an average of $24.69. Considering the 63 million annual American volunteers, who donate 8 billion hours of work, that adds up to more than $200 billion in volunteer work each year! The data was calculated by taking the national average wage for workers, plus 12% to estimate for fringe benefits, such as donation potential, special skills, and networks.
The value of an organization’s specialized skill volunteers can even be used on financial statements, too, says the Financial Accounting Standards Board (FASB). If a volunteer’s service is something the organization would have otherwise paid for, such as a doctor volunteering medical services for free in an area in need. However, the volunteer’s value is based on the work performed, so a doctor walking dogs at an animal rescue does not increase the value of time volunteered.
Assigning a value to volunteer hours allows an organization to present their full resources, acknowledging the incredible contributions volunteers make. The volunteer hours are a source of revenue for nonprofits, as well. Without volunteer hours, fundraising goals would need to be higher to make up for the human resources that volunteers provide. Thinking of volunteer value as revenue, organizations can calculate their return on investment (ROI).