Sections of this topic
The Nonprofit Finance Fund has released their 2013 State of the Nonprofit Sector report. This is the fifth year for this large and comprehensive study. Almost 6000 organizations responded to the survey. The report includes an online analyzer that enables you to analyze data by state, sector, size, and low-income communities. Be sure to check out this aspect of the report.
I strongly recommend that you review the whole report and use the analyzer to assess how your organization stacks up against others in your state and in your sector. I tried the analyzer to review the data for New Jersey – my home state – and found it to be easy to use and have some important data suitable for advocacy. Be sure to check out this aspect of the report. This study was funded Bank of America Charitable Foundation.
I am writing two companion blog articles on the report. My blog article at marionconway.com highlights mainly government funding, foundation support, low-income communities, and a comparison of my home state – New Jersey – results versus the total US results. This article features issues related to mission and Board. As always, this article features the study results mixed in with my commentary.
The overall most telling data point for me is that five years ago 44% of nonprofits answered no when asked if they were able to meet demand for services and this year the number is 54%. It is a startling increase in an inability to meet the demand for services. It is caused by decreased funding from the government and foundations, increased demand, and increased costs. This combination has become the perfect storm.
So how are nonprofits approaching this dilemma? There are some surprises in the data.
Action taken in 2012
49% Added or expanded services
17% Reduced/eliminated services and programs
39% Collaborated with another organization to grow/add services
30% Upgraded technology to improve/grow services
There is really good news in these survey results. Instead of folding, nonprofits are using the ingenuity that is in their DNA to do more even as the financial picture is challenging. I was so happy to see strong responses to collaboration and technology because I believe that both are essential keys for adapting to the new financial normal. More good news nonprofits report a big expected increase in these areas for 2013. If you’re not on board yet…..jump on! To be sure nonprofits are being cautious and seeking “balanced growth” and just as for-profit corporations have become less giddy and more thoughtful about growth so have nonprofits. Many have learned the hard way that government contracts don’t pay for everything and are subject to change and new rules, etc. It is a great source of funding but has to be looked at realistically. In 2012 over 40% of nonprofits hired new staff, 36% engaged more closely with Board and 31% relied more on volunteers. For 2013, nonprofits project less hiring and more reliance on Boards and volunteers. If you are a Board member or volunteer get ready to roll up your sleeves even more this year.
It needs to be as much about looking at long-term sustainability as it does short-term survival. I see that many small nonprofits that I work with are finally coming to grips with this.
The survey results suggest that Nonprofit Boards are engaged at an acceptable, if not a perfect level of participation. Here are some of the results:
