The Estimated Economic Value of a US Volunteer Abroad

Summary

The labor performed by domestic volunteers is commonly assigned an economic value to determine the product volunteers contribute to the national economy (Independent Sector, 2007). This brief summarizes several approaches estimating the economic value of US volunteers abroad, and compares these estimates to calculations using the 2005 Current Population Survey volunteer supplement (U.S. Bureau of the Census, 2006) and the Independent Sector’s 2005 estimation of the hourly “wage” of a volunteer at $18.04. By these standards, in 2005 the value of US volunteer time abroad was $2.92 billion.

This demonstrates the economic benefits of voluntary labor, assuming a wage would be paid to an employee to complete the same work in the absence of a voluntary contribution of time. Quantifying the economic value of volunteers is challenging because it ignores other intangibles that volunteers may provide beyond time. As with any economic estimation, there are multiple assumptions and limitations to this approach.
One important assumption in this calculation is that the profile of international volunteers and domestic volunteers is fairly equal in terms of hourly earnings. Differences in income are minimal; however, there are significant differences in age, employment status, and education. These discrepancies could alter the value of voluntary labor performed overseas (Lough, forthcoming).

The hourly wage of volunteers, as determined by the Independent Sector, is based on the assumption that volunteers perform specialized skills for host organizations (Independent Sector, 2007). It could be that international volunteers perform unskilled services for host organizations, in which case the estimated value would be lower. Also, the calculation assumes that beneficiaries would have purchased the services if they had not been donated, and is based on the cost of wage labor in the United States (Independent Sector, 2007). The actual value of international volunteer labor could be lower due to differences in wage parity between countries.

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