GuideStar’s New Economic Survey Shows Two-Thirds of Charitable Nonprofits Experienced Decreasing or Stagnant Contributions in 2012
At Same Time, Those Organizations Reported an Increase in Demand for Services
Overall, these responses are in keeping with the tepid recovery from the ‘Great Recession’ that the economy has seen thus far.
In an era of changing donor behavior – not to mention an uncertain economy – nonprofits need to be smart about how they try to capture the attention of funders and donors.
Our ‘Money for Good II’ research with Hope Consulting showed us that donors want meaningful information; they want details about performance and results more than anything else from nonprofits.
Washington, DC—November 15, 2012—GuideStar—the leading source of nonprofit information—today announced the results of its 11th annual nonprofit economic survey, which examined the effect of the economy on the American nonprofit sector. The survey asked public charity and private foundation employees about the change in total contributions to their organizations in the first nine months of 2012 compared to the first nine months of 2011. In 2012, 37 percent of respondents said contributions had decreased, 34 percent said they had increased, and 28 percent reported that they had stayed about the same.
“Overall, these responses are in keeping with the tepid recovery from the ‘Great Recession’ that the economy has seen thus far,” said Chuck McLean, GuideStar’s vice president for research. “Sluggish giving from individuals combined with a slow economic recovery means the nonprofit sector has a ways to go to return to levels of giving seen before the economic meltdown.”
Overwhelmingly, the reasons given for the decline in contributions center around individuals, with 77 percent of respondents reporting that gifts from individual donors were smaller, and 75 percent reporting that fewer individuals gave.
At the same time that about two-thirds of organizations were receiving decreasing or stagnant contributions, they were experiencing an increase in demand for their services, with 38 percent reporting that demand had increased modestly and 26 percent reporting that demand had increased greatly.
Overall, the numbers for 2012 look very similar to the numbers for 2011, suggesting a nonprofit sector where things are not getting much better or much worse, at least from a financial perspective.
“The nonprofit sector continues to face a difficult fundraising environment,” stated Jacob Harold, GuideStar’s president and CEO. “In an era of changing donor behavior – not to mention an uncertain economy – nonprofits need to be smart about how they try to capture the attention of funders and donors. This holiday season, when one-third of the entire year’s online donations are made, is a great time for nonprofits to think about how they communicate their impact. Our ‘Money for Good II’ research with Hope Consulting showed us that donors want meaningful information; they want details about performance and results more than anything else from nonprofits.”
For tips on what kinds of information donors and funders want from nonprofits and free resources to help get nonprofits started, download GuideStar’s new, free guidebook, More Money for More Good: www.guidestar.org/moneyforgood.
About GuideStar’s Economic Survey
The survey was conducted online from October 4 through October 19, 2012, and elicited 500 usable responses, with 95 percent (476) coming from public charities and 5 percent (24) coming from private foundations.
Download a free copy of the survey report at http://www.guidestar.org/rxg/news/publications/nonprofits-and-economy-october-2012.aspx.
GuideStar, www.guidestar.org, connects people and organizations with information on the programs and finances of more than 1.8 million IRS-recognized nonprofits. GuideStar serves a wide audience inside and outside the nonprofit sector, including individual donors, nonprofit leaders, grantmakers, government officials, academic researchers, and the media.