America's nonprofits are expecting 2011 to be another tough year for their organizations, and for the people they serve, according to a survey released by Nonprofit Finance Fund (NFF), with support from the Bank of America Charitable Foundation. The survey of more than 1,900 nonprofit leaders in markets nationwide found that while there are some signs of hope, many nonprofits are straining under year-after-year increases in the demand for services.
2011 will be another tough year for nonprofits and the people they serve.
- 85% of organizations expect an increase in service demand in 2011; just 46% expect to be able to fully meet this demand.
- This comes on top of years of increases: in 2010, 77% of nonprofits saw an increase in demand; in 2009, 71% experienced an increase in demand, and 73% of organizations experienced increased demand in 2008.
- 60% of organizations have three months or less of cash on hand; 10% have none.
- Only 9% expect 2011 to be financially easier for the people they serve.
Yet, there are signs of hope.
- 44% of nonprofits reported ending 2010 with a surplus, a move in the right direction from the 35% who had a surplus in 2009.
- 25% of organizations added to reserve funds in 2010.
- 35% of organizations raised more revenue in 2010 than anticipated.
"Years of economic uncertainty have forced nonprofits to adjust to the 'new normal' of scarce resources and increased demand," said Rebecca Thomas, vice president of consulting services at NFF. "Some of the adjustments we're seeing are creative and healthy, such as strategic collaborations to improve impact in a community. Other effects, including layoffs, people who need services being turned away, organizations operating at a deficit or with no cash, are further compromising the social safety net at a great cost to America."
Lifeline organizations that provide critical services to people in need are finding it particularly hard to meet the demands in their communities.
- 87% of lifeline organizations saw an increase in demand for services in 2010, compared with 68% of non-lifeline organizations.
- 60% of lifeline organizations increased the number of clients they served in 2010, yet only 43% were able to fully meet the demand for their services.
- Just 37% of lifeline organizations expect be able to fully meet demand in 2011.
"Unfortunately, the recession is not over for many of us in the nonprofit sector. One of the hardest things is finding funding for operating support," said Ann King, executive director of the Tri-Valley Haven, a community resource center serving adults and children who have experienced domestic violence, sexual assault, or homelessness. "Last year, we received more restricted money and less of the important general funds that help us manage the organization. We've said 'no' to funding opportunities that didn't cover their own cost, which on the one hand, we're proud of, but on the other, makes us hope for the unrestricted money that is most helpful to our organization and the people we serve."
"Unrestricted support ties you to the overall success of the organization and supports the overall mission," said Kerry Sullivan, president, Bank of America Charitable Foundation. "In this economic environment, it's imperative to do what you can to help nonprofits keep the lights on while they are supporting such an increased demand for the most essential, basic services."
Despite the challenges, nonprofits are not standing still. Nonprofits are coping with the 'new normal' of fewer resources, and are taking significant and creative steps to meet the needs of their communities. Over the past 12 months:
- 55% added or expanded programs or services;
- 49% increased the number of clients served;
- 47% partnered with another organization to improve or increase services offered;
- 39% reduced annual expenses; and
- 36% relied more on volunteers.
Complete survey results are available at: http://nonprofitfinancefund.org/2011Survey.