Think tank economists have valued civil society’s true economic contribution at nearly £40bn a year, about double UK government estimates when including volunteer labour.
The government’s latest official Gross Value Added (GVA) statistics – which follow international accounting rules – estimate that civil society contributed £18.5bn in 2023, accounting for 0.8% of the UK economy and growing by 2.3% compared to the previous year.
However, research by PBE and commissioned by the Gradel Institute of Charity has estimated that civil society contributed £39.6bn in 2024, representing 1.5% of the economy and comparable to the combined output of the UK’s agriculture and car manufacturing sectors.
The main reason for the higher estimate is that PBE has included an estimate for the value of volunteering – £15.5bn per year – which the government’s GVA figures exclude.
Meanwhile, government-commissioned research published this month valued volunteering in England alone as being worth £24.7bn in 2021-22, including wellbeing benefits.
£38.5bn loss due to volunteering decline
PBE estimates that charities, voluntary organisations, and community groups contributed 1.4 billion hours of work, 2.5% of all hours worked across the UK economy, in 2024.
Volunteers provided 688 million hours of unpaid work, equivalent to £15.5bn in economic value, while the sector also supports 480,000 paid jobs, PBE estimates.
The think tank warned that civil society’s potential is being constrained by financial pressures and declining volunteer participation post-pandemic, estimating that a fall in volunteering since 2019 has resulted in a £38.5bn loss in potential economic value over the past five years.
It renewed calls for the creation of a civil society satellite account, for which the government conducted a feasibility study last year, to better capture the full economic contribution of the sector, which it says could be even higher.
PBE chief executive Matt Whittaker said the report’s figures show that civil society’s economic contribution is “routinely underestimated”.
“If policymakers continue to overlook civil society’s economic footprint, they risk undermining a sector that supports jobs, skills, health, and resilience across the country,” he said.
“The government must act now to better measure, recognise and invest in civil society’s power to drive sustainable economic growth.”
Gradel Institute director Stephen Bubb said: “A strong and powerful civil society can make a much bigger contribution to the government aim of growing the economy, reforming public services and building the social infrastructure that underpins economic growth.
“One of the key recommendations of our recent report was for a treasury task force to look at the potential of the sector’s contribution to economic growth and so I was pleased to see in the covenant published last week that the treasury is establishing a forum of third sector leaders to do just that.
“By recognising and investing in our sector, we can unlock more growth and build stronger, more resilient communities.”
