Meeting demand is key struggle according to new nonprofit fundraising survey

A new national survey about the current state of nonprofit fundraising has just been published and it reveals a mixed batch of results which emphasize that although things are getting slightly better there is a growing demand for services which funding is struggling to match. The survey received input from over 1,900 nonprofit leaders who were primarily employed by small to medium-sized nonprofits and compared data from the last two years along with projections for 2011. The research was conducted by the Nonprofit Finance Fund in conjunction with Bank of America. I’ll highlight some of the key findings but would encourage you to take the time to look at the full report.

Bear in mind the study was focused in the US market and many of the findings would be in keeping with what I would’ve expected. There has been no rapid return to pre-recession funding levels yet, in fact the vast majority (more than 85 percent) of those surveyed when asked ‘does it feel like the recession has ended?’ replied ‘no’. Although on balance the results from 2010 were an improvement over 2009 many nonprofits are struggling to meet an ever increasing year-over-year demand for services and are working hard to find new methods to fulfill these demands while still remaining viable financially. Those industrious solutions are the part of the report that I found most interesting as nonprofits seek to create a formula where the provision of the service can grow at a higher rate than donations, while it appears to be possible to a certain extent it would not appear to be a sustainable approach for many.

When comparing 2010 with 2011 expectations the following facts were noted:

• hiring of new staff will be reduced
• reducing staff levels will be curtailed significantly (28% down to 11%)
• retaining all current staff is an increased objective
• a higher likelihood of freezing or reducing salary in 2011
• a higher likelihood of reducing staff benefits in 2011
• a growing reliance on volunteers
• a reduction of staff hours while trying to maintain the same levels of service

As you can see the tendency is to try and do more with less to meet the demand for services which have continued to grow at a staggering rate; over 85% of those surveyed anticipate an increased demand for services in 2011 while only about 40% estimate that they will be able to fully meet such demand. That growth in demand for services continues the trend of the last three years as 77% percent of nonprofits saw increased demand in 2010, 71% in 2009 and 73% in 2008. In one sense the leaders of organizations feel this emphasizes the fact that they are well-placed to meet a genuine need but on the other hand adjusting to a new environment where funding is more restricted has seen them have to accept that some initiatives simply cannot be started or fulfilled in the current climate.

Mixed in with the concerning results are some elements of good news as well and it would be fairly safe to say that the most difficult years seem to have now passed. Based on those surveyed funding situations looked to have improved slightly with 44% reporting a surplus at the end of the year compared with 35% at the end of 2009. In fact some 35% of organizations surveyed were able to raise more revenue in 2010 than they had anticipated. If you have an opportunity to look at the report you’ll notice that the most encouraging sign however remains the creative adjustments being made by many organizations in spite of many of the funding challenges, as you’ll see in many circumstances new services were added, more people were served and operational expenses were reduced.

The Nonprofit Finance Fund (NFF) is a national leader in nonprofit, philanthropic and social enterprise finance you can learn more about them here.

To read the full report visit here or view it as a slideshow please visit this site provided by the NFF.

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