Professional Membership Organizations

SIC 8621

Companies in this industry

Industry report:

This industry covers membership organizations of professional persons for the advancement of the interests of their profession.

Industry Snapshot

Professional membership organizations are nonprofit voluntary membership associations that represent individuals with a common background in a subject or profession such as law, medicine, or accounting. In the late 2010s, approximately 17,250 such organizations were in operation in the United States. Three types of professional societies exist. The first includes any group with a common personal interest, such as the International Society of Stamp Collectors. The second type is dedicated to religious, charitable, public service, or fraternal causes, such as the National Council on Aging or the American Heart Association. The third classification covers organizations dealt with in this industry classification and includes scientific, engineering, and learned societies whose purpose is to advance knowledge related to their respective fields. Examples include the American Chemical Society, the Society of Automotive Engineers, and the National Association of Accountants.

The main responsibilities of professional membership organizations are to provide and enforce standards of professional practice and to conduct research. These organizations generally also provide educational programs, and most supply current information and research materials to their members, governmental agencies, and the public. Because dissemination of timely information has been of the utmost importance, implementation of communications technology has become critical for effective association management.

Professional societies conduct research, set professional standards, collect statistical information, produce educational programs, and represent their members' interest before legislative and regulatory bodies. They also provide information about their respective fields of study to many audiences, including the general public, association members, and government officials.

Perhaps the most important responsibility of professional societies has been the development and enforcement of standards of practice and safety as well as ethical codes. These organizations provide education and testing for certification, accreditation, and licensing of their membership. They also encourage the peer review process, offer courses that meet legal requirements, and issue standards that form the basis for disciplinary action. Approximately 30 percent of all professional societies set professional standards, and 15 percent certify that these standards are met.

Membership education has also played a critical role in professional societies, because the public interest is served by the quality of members' service and standardized accreditation. About 95 percent of professional membership organizations offer such educational programs, leading to annual expenditures of more than $3 billion on educational programs and services, while 46 percent offer scholarships. Seventy-one percent of all associations gather statistics and conduct research. For professional societies, the duty of research has been part of their very definition and purpose of existence. Research findings set important new directions and define the scope, standards, and trends within a particular field, and are often a primary source of government research and statistical compilations. This information usually is shared through some form of print or electronic journal published by the professional society. According to a survey conducted by the ASAE, 62 percent of associations publish both periodicals and nonperiodical literature. Of these, 33 percent publish only periodicals, 82 percent publish newsletters, and 75 percent publish magazines and scholarly or research journals.

One of the most visible activities of professional membership organizations has been legislative or lobbying efforts. Approximately 40 percent of all national associations have at least one lobbyist and one-third maintain political action committees (PACs). PACs are particularly popular among smaller organizations, with 52 percent of state and regional associations having political action committees. Professional societies allocate approximately 5 percent of their total annual expenditures to providing information to Congress regarding legislative or regulatory proposals that could affect the activities of their membership.

Organization and Structure

Professional membership organizations include bar associations, dental associations, engineering associations, medical associations, professional standard review boards, and scientific membership associations. The memberships of professional societies are made up of individual doctors, dentists, or scientists. Membership services generally have been designed to benefit the individual members and include continued education, accreditation programs, government relations, publishing, and research.

Professional membership organizations can be organized at the local, state, regional, national, and international levels. Sometimes an individual may be a member of an organization at different levels. For example, a doctor may belong to the local, state, and national levels of the American Medical Association. Groups with similar interests also can belong to a federation or collection of professional membership organizations, such as the American Association for the Advancement of Science.

Most professional societies, depending upon the nature of their membership, fall under one of the following tax-exempt categories defined by the Internal Revenue Service (IRS). Classification 501(c)(3) includes religious, charitable, scientific, public safety testing, literacy, and educational organizations. Section 501(c)(4) covers civic or social welfare organizations and local associations of employees. Section 501(c)(5) includes labor, agricultural, and horticultural groups.

The structure of a professional membership organization depends upon the size of its membership and its budget. A large national organization may have hundreds of people on its staff. Usually, a board of directors sets the policies of an organization, and the executives and staff members are responsible for the implementation of these policies. Divisions within a professional society include the legislative staff, meeting planners, publications executives, public relations personnel, information and research executives, membership services personnel, and fund-raisers.

Background and Development

The formation of professional associations in the United States began during the Industrial Revolution. However, most of these groups were trade-related, not professional societies. As the United States began to develop urban areas in the mid-1800s, many professional and educational groups were established. Some organizations, such as those representing medicine, law, and accounting, were created specifically to develop and enforce standards of practice. The American Medical Association (founded in 1854,) the American Dental Association (established in 1859), and the American Bar Association (created in 1878) are among the organizations formed during this period.

By 1900, 100 national associations existed in the United States, and by the end of World War I, that number had reached 1,000. After World War II, many trade associations changed their focus or evolved into new organizations due to technological advances in the modern business community. However, unlike trade groups, professional membership organizations maintain many of the same responsibilities as they did when they were first founded.

During the late 2000s, associations mirrored the behavior of the industries they represented. As merger activity swept across all industries, associations from different but related industries likewise merged to maintain viable and effective membership. For example, at the end of 2008, the American Electronics Association and the Information Technology Association of America merged to create the Technology Association of America to represent its combined 2,000 member companies. In 2009, the National Retail Federation and the Retail Industry Leaders Association announced a merger. Many organizations during the late 2000s were busy advocating for their members on issues related to health care reform, free trade, and new job creation. For example, the American Medical Association was deeply involved in health care reform and the subsequent changes in Medicare and Medicaid payments and insurance co-payments made to physicians across the country.

Current Conditions

Seeking out new strategies to provide high-quality services to their members and the public, professional membership organizations relied increasingly on non-dues income, such as fees derived from online information provision. At the same time, however, new associations rose quickly to serve the interests of emerging industries, particularly those related to technology. Professional membership organizations were also stepping up efforts to attract members and remain the premier catalysts for their fields. These associations remained a vital source of information for individuals practicing in those fields, as well as for related businesses that take advantage of associations for client outreach and valuable marketing information.

Although a handful of large organizations employed over 1,000 people, two-thirds of the 15,500 organizations in this category were generally small establishments, employing fewer than five people; 80 percent of associations employed fewer than 10 people. Total revenues for all professional organizations in this category exceeded $18.5 billion that year. Some of the more well-known professional organizations included the American Medical Association, the American Bar Association, and the American Dental Association.

Industry Leaders

American Medical Association.
Founded in 1854, the American Medical Association (AMA) is headquartered in Chicago. By 1962, the AMA boasted 82 percent of the country's physicians as members. As the largest doctor's group in the country, the AMA's membership was over 228,000 in 2009.

With annual revenues of $282 million in 2008, the AMA disseminates a tremendous amount of information to both the public and members of the medical profession. The AMA informs members about medical and health legislation at the state and national levels and represents its membership to legislative and regulatory bodies. It also assesses physicians' adherence to its uniform standards through the American Medical Accreditation Program and seeks to enforce ethical codes of conduct for use throughout the medical profession.

With a $65 million publishing operation, the AMA is the world's largest publisher of medical and scientific information. Two of its most well-known publications are American Medical News, a weekly publication covering political, social, and economic issues as they pertain to medical care, and the Journal of the American Medical Association, (JAMA) a weekly publication devoted to topics in general medicine. The AMA also assists in setting standards for medical schools, hospitals, residency programs, and continuing medical education courses. In addition, the organization offers physician placement services and counseling regarding practice management issues.

During the late 2000s, the AMA experienced some financial setbacks due to a number of factors primarily related to the recessive economy. Although the association was able to report its ninth straight year of net profit in 2008, revenue gains fell significantly from previous years, down from $24.4 million in 2007 to $2.5 million in 2008. For example, for that year, publishing revenues were down $6.4 million, membership dues fell by $1.3 million, and income from interest fell by $2.1 million.

Membership numbers were also a concern in the early 2010s. According to MedPage Today, the AMA lost about 5 percent of its membership, or 12,000 members, when President Obama's healthcare reform plan, which the AMA had supported, passed in 2010. Subsequently, revenue from membership dues declined 10 percent, or $4.2 million, in 2010. Nevertheless, total revenues increased $5.2 million that year, mostly due to "stronger publishing and business revenues," according to MedPage Today.

American Bar Association.
The American Bar Association (ABA) is the world's largest voluntary professional association. Founded in 1878, it is a national organization that represents all attorneys in good standing before the bar throughout the United States. Headquartered in Chicago, the ABA boasted a membership of more than 400,000 in 2010.

The ABA addresses broad social concerns such as the high costs of litigation, legal services, free press, and fair trial issues. This organization conducts research, provides educational programs and public services, and seeks to improve the administration of civil and criminal justice. The ABA has 800 employees who operate 25 sections, including Criminal Justice, Economics of Law Practice, and Family Law. The organization's major publication is the monthly ABA Journal, which covers developments in law and association news.

American Dental Association.
Founded in 1859, the American Dental Association (ADA) is a national professional society for dentists, with 53 state or territorial and 545 local dental societies. Its membership was 156,000 in 2012 (about four out of five dentists in the United States). This organization promotes dental health issues to the public and dentistry issues regarding legislation, standards, and regulation. The ADA inspects and accredits dental schools and schools for dental hygienists, assistants, and laboratory technicians through its Commission on Dental Accreditation, which derives its authority from the U.S. Department of Education.

The ADA, which maintains a library of 33,000 books and 17,500 bound journals, conducts a vast amount of research and produces most of the dental health educational materials used in the United States. The organization also compiles statistics regarding personnel, practices, dental care needs, and attitudes of patients, and maintains a biographical history of dentists in the United States. The ADA is headquartered in Chicago, operates with a staff of 475, and had a $120 million budget in 2011. Its official publication is The Journal of the American Dental Association, as well as the ADA News and the Index to Dental Literature.

American Association for the Advancement of Science.
The American Association for the Advancement of Science (AAAS) is the largest general organization representing all areas in the field of science. Its 2012 membership included 261 affiliated societies and academies of science and 10 million affiliated scientists. Founded in 1848, the AAAS is headquartered in Washington, D.C., and has a staff of 350 people.

The goal of the AAAS is to promote the work of scientists and "improve the effectiveness of science in the promotion of human welfare." This professional membership organization conducts seminars and colloquia regarding scientific issues. The AAAS plays a role in settling crucial scientific questions and addresses issues such as population growth, environmental destruction, and viral infections. It also produces an annual report and a monograph series, which provide information about proposed federal research and the development budget for the upcoming year, and maintains Science Online on the Internet. Its highly respected weekly journal, Science, boasts an extensive readership. The AAAS also produces ScienceNOW, Science Signaling, and Science Translational Medicine. In addition, the AAAS maintains an extensive online presence with online multimedia libraries and resources.

American Institute of Certified Public Accountants.
Headquartered in New York, the American Institute of Certified Public Accountants (AICPA) is a professional society of accountants certified by the states and territories. The organization was founded in 1887, and in 2012 had 377,000 members in 128 countries. This organization has become known for its preparation and grading of the national Uniform CPA Examination for state licensing bodies. Other responsibilities of the AICPA include establishing, auditing, and reporting standards and determining the financial accounting standards included in the financial statements of U.S. companies. The AICPA also conducts research and continuing education programs and operates more than 135 boards, committees, and subcommittees that deal with issues ranging from accounting standards and professional ethics to computer services. The AICPA publishes a number of print and online newsletters and journals. The most prominent of these publications include the Journal of Accountancy and Tax Adviser.

National Society of Professional Engineers.
Founded in 1934, the National Society of Professional Engineers (NSPE) is an organization representing professional engineers and engineers in training in all fields registered in the United States and Canada. In 2012, the NSPE, headquartered in Alexandria, Virginia, represented approximately 45,000 qualified graduate engineers, student members, and registered land surveyors, who are organized in 500 chapters. Revenues for fiscal year 2008 were $12.4 million.

The NSPE is concerned with the social, professional, ethical, and economic considerations of engineering as a profession. It focuses on these issues through a number of public relations programs and provides continuing education programs. The organization also monitors legislative and regulatory actions of interest to the engineering profession. The NSPE publishes the Engineering Times monthly.

Workforce

In 2010, some 297,000 people were employed in business, professional, political, and similar membership associations throughout the United States. Professional organizations need communication specialists, researchers, writers, meeting planners, publicists, and lobbyists as well. Because staff members are exposed to a wide variety of functions and responsibilities, association employment can offer tremendous advancement potential. Executives can earn salaries nearing the $1 million mark.

Entry-level employment at associations generally can be found in the areas of conference planning, public relations, or membership services. Most jobs require that employees have a liberal arts degree with strong interpersonal and communication skills and some computer knowledge. Additional education, such as an MBA or legal training, may be necessary for financial services or legislative positions. Association executives may earn Certified Association Executive (CAE) designation upon the successful completion of a written one-day test.

Although associations are located across the United States, many can be found in metropolitan areas. Perhaps reflecting the growing prominence of political action committees, Washington, D.C. is home to more professional membership organizations that any other city, followed by Chicago and New York City. Moreover, many professional membership organizations have chapters located in or near state capitals.

America and the World

The emerging global community has increased the interest and the need for U.S. professional membership organizations to share their talents overseas, especially with growing business communities in emerging democracies. Many organizations have begun to develop subcommittees or international task forces to deal with these expanding needs as they pertain to their respective profession. Staff members of professional societies who handle international relations issues usually have expertise in overcoming language barriers, finding alternative delivery systems, and forming chapters outside the United States. Most often, these people are contacted by members regarding international economic, social, and political issues.

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