Pulse Check: How Are Nonprofits Doing?

A slew of surveys and studies have been conducted recently by a number of different organizations and agencies throughout the U.S. I offer selected information from a few of them to provide some insight into how nonprofits are doing.

Snapshot of Issues Facing Nonprofits: Fundraising Outlook for Fiscal Year 2009: [pdf] Prepared in March 2009 by the Silicon Valley Council of Nonprofits, this report finds:

• Nonprofits are increasingly concerned about massive cutbacks from traditional government funding sources and the reduced level of services to those in living in poverty.
• There is increased client need over last year.
• A serious concern about layoffs and staff downsizing in the nonprofit sector is prevalent.
• The overall number of individual donors has increased over last year.
• Corporate giving is drastically down from last year and is expected to continue downward well into next year due to the downsizing of many of our local corporations.
• Increased foundation giving seems to have had the greatest impact on emergency assistance such as food, clothing, and housing assistance agencies.

The Quiet Crisis: The Impact of the Economic Downturn on the Nonprofit Sector [pdf]. Released in March 2009 by Civic Enterprises and Democratic Leadership Council, this report says:

Reversing the nonprofit plunge is a matter of jobs, not just charity. With 9.4 million employees and 4.7 million full-time volunteers nationwide, nonprofits constitute 11 percent of the American workforce -- greater than the auto and financial industries combined. If the nonprofit sector were a country, it would have the seventh largest economy in the world. We cannot afford for it to go the way of Iceland, whose financial system collapsed.

Nonprofit Fundraising Trends 2009 [pdf]. Released 2/25/09 by Retriever Development Counsel, LLC, this report says:

Organizations that are doing well are not necessarily the ones with the biggest budgets or the ones that had the best fundraising year in 2008. Hallmarks of these organizations include:

• Diversified revenue streams and a variety of ways to give;
• Engaged leadership (executive, development/fundraising, and board) that is prepared to address the changes in the coming year;
• More effort expended into donor outreach and cultivating relationships;
• Investment in development staff, resources, and/or activities; and
• Proactive planning. They are looking to do more, not less.

Nonprofit Mergers and Acquisitions: More Than A Tool for Tough Times. Issued in February 2009 by Bridgespan Group, which states:

Mergers and acquisitions (M&A) are much more common in the nonprofit world than most would think, as our study of 3,300 deals across four states over 11 years shows. But nonprofit mergers often come about through default—due to financial distress or leadership vacuums. At the same time, relatively few nonprofits are using M&A strategically, as a way to strengthen organizations' effectiveness, spread best practices, expand reach, and to do all of this more cost-effectively. Yet the potential for M&A to create real value in the nonprofit sector exists, particularly if more philanthropists take on the mantle of matchmaker and help nonprofits explore and evaluate M&A opportunities. This article discusses research conducted by the Bridgespan Group on nonprofit M&A; explores the Child and Family Services (CFS) field, where "market" conditions are especially favorable to combinations; and profiles two nonprofits making the most of acquisitions. It also issues a call to action to philanthropists to further strategic, social sector M&A.

A Snapshot of the Effects of the Economic Downturn on Nonprofits [pdf]. Issued by Management Consulting Services in January 2009, this white paper attempts to gauge the impact of the economy on Massachusetts nonprofits. Here's a sampling of findings:

• While organizations of all budget sizes anticipate the economic downturn impacting their organization, organizations with smaller budgets indicate that the impact will be greater compared to organizations with larger budgets.
• More than half the respondents reported that their organizations will see a decrease in revenue during the current fiscal year. About one-third of the respondents feel that the revenues would decrease more than 10% during the current fiscal year at their organizations. About one-third of the respondents also feel their organizations will experience a decline in revenues during the next fiscal year.
• There were no significant trends related to decrease in revenue across organizations with different operating budgets or across program areas, suggesting that organizations across all program areas and operating budgets are seeing similar changes.
• While the respondents felt that the revenues were decreasing, many (40.5%) felt that the demand for the services of their organization had increased in the past 3 months.
• While there were no significant trends related to changes in demand over the past 3 months across organizations with different operating budgets, significantly greater percentage ofrespondents from organizations providing human services reported more than 10% increase in demand during the past 3 months.

Do you know of other reports, studies, findings? Share!!

Thanks to Cindy Bailie, Director, Foundation Center-Cleveland, for sharing this post.