It is difficult to quantify the voluntary sector’s value to the wider economy. Three indicators are often used to estimate the sector’s contribution are:
- the estimated output of the sector (known as Gross Value Added or GVA)
- the number of people the sector employs
- the contribution that volunteers make
Added Value (GVA)
- The contribution to the economy of different sectors is measured by the Office for National Statistics (ONS) based on a sector’s production or output (Gross Value Added, GVA).
- NCVO and ONS have developed a method of estimating the voluntary sector’s GVA, based on staff costs plus spending on goods and services less income from sale of goods and services.
- According to this method, the voluntary sector contributed £15.3bn to the UK economy in 2015/16, representing 0.8% of total GDP.
- To put this amount in context, the contribution of the sector is similar to the GDP of Estonia (£15.5bn, ranked 101 out of 198 countries).
- The contribution of the sector has increased since 2014/15, both in terms of the amount and as a percentage of GDP and has moved up the GDP country ranking. Last year, it was closest to the GDP of Cyprus, then ranked 107 and ranked 108 in 2015/16.
- The voluntary sector workforce increased by around 35,000 (+4%) from June 2016 to June 2017.
- 880,556 people worked in the voluntary sector in the UK in June 2017, equivalent to 2.8% of the UK workforce, the same proportion as in June 2015.
- The public sector employed 7.0 million people and the private sector employed over 23.8 million.
- The voluntary sector workforce is around three-fifths of the size of the NHS, the single largest employer in the UK (1,501,007 employees). Tesco employs just over half as many people (460,000).
- An estimated 11.9 million people formally volunteered at least once a month in 2016/17.
- The most recent figures from ONS, for 2015, estimate the value of formal volunteering in the UK to be £22.6bn.
- Voluntary organisations are included in ONS estimates as part of ‘Non Profit Institutions Serving Households’ (NPISH) but NPISH includes other activities too, hence the need to develop a method to estimate the voluntary sector’s GVA. Although the method has its limitations, we judge it provides the best indication of the economic value of the sector.
- Get the data here. Figures have been converted from US$ to GB£ using an average of the monthly HMRC exchange rates for the period.