Nonprofit organizations have seen a slight turnaround in giving so far this year that mirrors the slow economic recovery, The Nonprofit Fundraising Survey: November 2010 [PDF] from the Nonprofit Research Collaborative (NRC*) finds. But the small rebound hasn't been enough to help many nonprofits that are grappling with staff and service cuts even as demand for their services has increased.
The national survey showed that 36 percent of charities reported an increase in donations in the first nine months of 2010, compared with only 23 percent in the same period of 2009. Thirty-seven percent of charities reported a decrease in giving, a dramatic change from 2009's 51 percent. Among those experiencing a decline in giving, the main reason cited was fewer individual donations and smaller amounts. Lower amounts received from foundations and corporations also contributed to the overall lower giving amounts at these charities. Giving remained unchanged at 26 percent of nonprofits in 2010 vs. 25 percent in 2009.
"We are beginning to see some positive signs, but despite that giving still has a long way to go to return to the levels it was at three or four years ago," said Patrick M. Rooney, executive director of the Center on Philanthropy at Indiana University, which spearheaded the collaboration. "One-fifth of charities in the survey said their budgets for 2011 will be lower than for 2010, forcing many of them to look at cuts in services, salaries and staff."
Among the 20 percent of nonprofits anticipating reduced budgets next year, 66 percent say they will have to reduce programs, services or operating hours, 59 percent expect to cut or freeze staff salaries or benefits, and 49 percent are planning layoffs or hiring freezes.
Will the slow but modest growth in foundation giving predicted for 2011 help? A recent Foundation Center survey responded to by 719 foundations provided useable responses as of mid-October 2010 on the outlook for foundation giving in 2010 and 2011, changes in grantmaking priorities and operations, and foundation response to specific needs created by the economic crisis.
Although giving by U.S. foundations is poised for modest overall growth in 2011, after remaining flat in 2010, it may take several years for giving to match the peak level recorded in 2008, according to estimates in Moving Beyond the Economic Crisis: Foundations Assess the Impact and Their Response [PDF].
Foundation operations appear to have stabilized following cuts in staffing, travel, or other operating expenses by a majority of grantmakers. In a sign that foundations may be turning the corner, only 12 percent of respondents to the Center's survey expect these operational changes to remain in place over the longer term. Among the changes that could persist: funders making fewer site visits to grantees, attending fewer conferences, eliminating print copies of annual reports, and moving to electronic grant applications.
How do the findings in these surveys mirror your organization's fundraising experiences? Are your contributions of gift income up, down, or remaining steady? Does your foundation expect to increase its giving in 2011? How is your organization coping? Tell us by leaving a comment.
*The NRC includes Association of Fundraising Professionals (AFP), Blackbaud, Center on Philanthropy at Indiana University, Foundation Center, GuideStar, and National Center for Charitable Statistics (NCCS).