Association Management Companies Gain 7% in Workforce in 2003 Despite High Unemployment Across The U.S.

Business Editors

ATLANTA--(BUSINESS WIRE)--Jan. 12, 2004

While America ended 2003 with a high unemployment rate of 6.0 percent and a high forced unemployment rate of 3.4 percent, association management companies (AMCs) experienced a 7.3 percent increase in their workforce during the year. In contrast, many other sectors in the economy were on a hiring downturn in 2003, and the forecast for 2004 does not show signs of much improvement. Median forecasts from the October 2003 Reuters poll of economists noted the jobless rate would average 5.9 percent for all of 2004, a negligible change from 2003.

What's driving the growth of AMCs in the face of downturns elsewhere? The challenging economy has initiated a rethinking in how association business gets done. Volunteer-managed associations often see AMCs as an efficient solution to an age-old problem: finding the time to manage association business while keeping up with the demands of a full-time "day" job.

AMCs - managers of associations' finances, annual meetings, governmental affairs, membership development, public relations, information technology and other services - see the need for their services continuing to expand. According to Dee Ann Walker, chair of the AMCinstitute, "The trends are there. Nine out of 10 adult Americans now belong to at least one association. As associations turn to AMCs to manage their organizations, AMCs have added to their staff to meet the demand. The AMC industry has grown 33 percent in the last eight years."

"One of the main reasons we have experienced payroll growth this year is due to the gain of new association clients. Many associations are volunteer or independently-managed and become much more efficient when joining forces with an AMC," stated Mark Engle, Principal of Association Management Center, a Chicago-based AMC.

With over 147,000 associations across the United States, and new organizations forming each year, association boards are finding AMCs and their growing workforce as solutions to their staffing needs. "Associations are realizing the high quality and value-added services that AMCs bring to their clients," said Mr. Engle.

Suzanne Berry, Executive Vice President of Association Resources, Inc., a Hartford, CT-based AMC, has added staff to handle increased business from existing association clients, in addition to new clients. "This year we have gained new business from existing accounts. Once we have shown the association how successful and efficient our AMC operates, they are happy to give us more business. As a result, we went from 35 employees in 2002 to 45 in 2003."

Managing associations through an AMC represents a change in the way nonprofit charitable organizations, trade associations and professional societies conduct business. During 2003, corporations were challenged to change the way they operated to become more efficient. As Federal Reserve Governor Susan Bies recently noted in the Reuters poll, referring to 2004, "...new jobs will need to be created in other sectors of the economy to replace them (jobs that were lost)." "Perhaps some of the individuals affected by these job losses will find their way to an AMC," noted Ms. Berry.

The estimated impact on the economy represented by non-profit trade associations and professional societies is 10-12 percent of the GDP. AMCs in the United States now manage budgets exceeding $2 billion collectively. The average AMC-managed association budget is $677,000 and the range of budgets for AMC-managed associations is anywhere from $25,000 to more than $16 million annually.

The AMCinstitute serves as an information resource for associations, their volunteer leaders, media and others interested in association management. AMCs are professional service firms that provide experienced staff, proven practices and shared resources to associations. For more information, contact the AMCinstitute at www.AMCinstitute.org