The Giving Review: If the “nonprofit-sector” tree falls in the forest …

This article first appeared in the Giving Review

“When asked broadly about their use of nonprofit services,” according to a survey of 1,790 people by the Indiana University Lilly Family School of Philanthropy for its recently released What Americans Think of Nonprofits & Philanthropy 2026 report, “just 7.4% of respondents indicated that they or someone in their immediate family had received or used services from a charitable organization or nonprofit in the past year.

“These self-reported usage numbers seem low, given the breadth and visibility of the nonprofit sector,” the report opines, coming close to seeming almost a little, well, hurt. Apparently thus still on the sector’s behalf, “To better understand whether Americans recognize their interactions with nonprofits,” it describes, “respondents were then asked about specific activities often provided by nonprofit organizations, such as attending religious services, visiting a museum, attending a performing arts event, or attending a private educational institution.

“[R]eported engagement was much higher when respondents were given specific examples,” according to the report, now seeming at least somewhat relieved. “Overall, 71.9% of respondents selected at least one of the listed activities.

“Comparing the 7.4% with the 71.9%, we see that among respondents who reported engaging in at least one activity often provided by nonprofits, nearly 90% did not initially report that they or an immediate family member had received or used services from a charitable organization or nonprofit,” it continues.

This finding points to a substantial recognition gap: Americans may interact with nonprofits regularly while not identifying those interactions as nonprofit service use.

More broadly, many people may associate nonprofit services primarily with direct assistance or basic needs, while overlooking the broader range of nonprofit institutions they encounter through religion, education, arts and culture, youth activities, animal welfare, and other areas of community life.

Recognition(s) of reality and perception

So, a “recognition gap,” yes. But maybe of another kind, as well. One can and should contemplate an application here of the classic philosophical thought experiment about the relationship between reality and perception: “If a tree falls in the forest and no one around to hear it, ….”

Does the “nonprofit sector” exist in the minds of anyone except people who work in it?

What Americans Think of Nonprofits & Philanthropy 2026 seems to want to say that Americans just don’t understand nonprofit groups and all they do—and, by implication, why they deserve their special status in society and public policy, which is increasingly being questioned, if not outright challenged. Membership in this constructed sector can carry substantial legal, regulatory, and tax advantages, which its members have a common interest in defending.

But what if Americans just don’t think of the groups according to the taxonomy preferred—in large part, constructed—by nonprofit professionals? Well, that would be a problem for the sector, too—probably a bigger one, in fact, calling into question the same special status on what might be a deeper and ultimately much more-consequential level.

The sector is immensely useful to people inside it, of course. It gives foundations, nonprofit executives, consultants, academics, and others a common identity—and something around which to organize, professionally and politically. There are schools of philanthropy, trade associations, conferences, and, as it happens, studies of what Americans think about it.

There might be more than a little recursive quality to the report, which was funded by the William and Flora Hewlett Foundation: the nonprofit sector has developed an academic-professional infrastructure sophisticated enough to discover that most Americans don’t know there is a nonprofit sector.

Did you hear that?, and other questions

Is the “nonprofit sector” a real-life social reality experienced by Americans? A legal and professional classification attached to institutions Americans understand in entirely different ways? Who might benefit from encouraging Americans to think of them all as one sector? How?

Maybe more provocatively, if groups in the nonprofit sector just want to pay less or no taxes, why don’t they just join up with believers in efforts to argue for such broader policy change for everyone? (Maybe the gains from such a change would be too, um, socialized?)

Perhaps the public doesn’t need the “nonprofit sector” nearly as much as the nonprofit sector needs the nonprofit sector.

Does it make a sound?

Source: https://capitalresearch.org/article/the-giving-review-if-the-nonprofit-sector-tree-falls-in-the-forest/