Productive caring

Key points

• Canada’s nonprofit (a.k.a. caring) sector is a big part of the answer to Canada’s weak productivity performance.
• By improving the quality of life in our communities, the caring sector helps attract and retain the skilled workers Canada needs.
• The caring sector is itself a major economic contributor at 8.4% of Canada’s GDP. 

They overlap in many ways, but it’s useful to consider three distinct economic sectors: the private sector, the government sector, and the nonprofit sector.*

I’ve always liked the moniker “the caring sector” over “the nonprofit sector” because people caring for others forms its core. Think of the soccer coach who cares about amateur athletics, the counsellor who cares about their patients’ mental health, the volunteer coordinator who cares about raising money for cancer research—and so on—and you get the idea.

Our society and our economy rely on a healthy caring sector just as much as they do on viable businesses and good government. And yet, a good case can be made that the caring sector is not getting the attention it deserves in the current (and much-needed) discussion about how to turn around Canada’s weak productivity performance and tepid economic growth.

The new federal budget, for example, talks about generating an “investment supercycle,” but has little to say about the role of nonprofit organizations in this.

So what are some of the ways nonprofits support the drive to greater productivity, increased business investment and stronger economic growth? Here are three:

1. Strong communities and strong labour markets are two sides of the same coin

The caring sector is the lifeblood of the vibrant, safe, and interesting communities that help attract and retain skilled workers. From nonprofit arts groups to historic societies to addiction services to places of worship, the caring sector helps make communities livable. Employment opportunities are obviously key, but they are only part of the equation.

In addition, the services provided by the caring sector help keep people mentally and physically healthy and, in this way, support the productivity of workers who might otherwise become sick or suffer from burnout. There is, for example, extensive research showing that poor mental health is associated with lost productivity at work. It’s not a magic bullet that makes everyone a happy and productive employee, but a healthier workforce is a byproduct of the opportunities to connect, learn, have fun, exercise, and find help provided by the caring sector. So when businesses donate money and encourage their employees to volunteer, it not only helps build better communities, it also helps build a better, more productive workforce.

2. The caring sector is itself an economic force

“Nonprofit” does not mean “nonproductive.” The caring sector is, in fact, a major component of Canada’s economy. As Imagine Canada reports, the sector:

• employs 2.9 million people (1 in 10 Canadian workers);
• contributes 8.4% of Canada's GDP (an estimated $244 billion);
• engages 11 million volunteers who give close to 1.2 billion hours per year.

Like other components of the economy, the caring sector will need to adapt as a number of transformative forces, including AI, an aging population, and a more complicated global economy, continue to create new challenges and opportunities.

3. Solving problems and inspiring creative solutions

The Canadian economy needs pipes and container facilities and mines and factories with the latest machinery, but it also needs ideas, innovation, and creative processes to make it more productive. This is another way the caring sector steps in.

In addition to supporting healthy communities and producing its own goods and services, the caring sector is a major stimulus and source of creative thinking. From arts and culture events to the neurodivergent workers hired by a nonprofit business to research institutes, the caring sector inspires ideas, showcases new perspectives, generates solutions to problems, and brings people together—all of which contribute to a more innovative culture and, ultimately, a more productive economy.

Bottom line

The caring sector is important and valuable in and of itself, but it is also important to the economy and a key part of the solution to Canada’s productivity problem. As such, we all have an interest in supporting the sector as much as we can and ensuring that it thrives rather than just gets by. In other words, it shouldn’t be an afterthought in Canada’s economic strategy, but a key component. 

*The informal sector (the myriad interactions that take place among families, friends, neighbours, and strangers independent of businesses, organizations, legal frameworks or policy programs) is a fourth one, but we will leave it for another day.

Answer to the previous trivia question: The highest-ranking military officer in Canada is General Jennie Carignan, who serves as the Chief of the Defence Staff.

Today’s trivia question: Canada’s current charitable laws can be traced back to which English monarch?