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News from the Community: Nonprofits Rebounding from the Recession?

How are nonprofit organizations recovering from the recession of 2008? We hear every day about how the financial sector is breaking records.

?While the stock market has recovered, the psychology of giving has not,? says Mark Medin, chief fundraiser at UUJA-Federation of New York, as quoted in an article on philanthropy.com. Since the economic downturn, charitable giving has risen each year. However, Giving USA predicts it could take until 2018 before fundraising revenue completely recovers. Although the projected growth for this year and next is higher than expected, it is still short of the 5.1-percent average rate recorded over the past 40 years.

Organizations are responding to the shortfall in different ways. Some organizations employ earned revenue sources, while others invest more in fundraising.

To provide a local perspective, our partners at GiveRichmond analyzed financial data between 2007 and 2013. The data includes only organizations that provided financials for all years in this time frame. Graphs are displayed by category and revenues are represented using median values.

Total Revenues Bouncing Back
In the chart below, you can see the dramatic drop in total revenues from 2007 to 2009 and a leveling off from 2010 to 2012. However, our most complete set of recent financials for FY2013 indicates a more significant trend upward across the board. The graph shows that organizations focusing on health and education have eclipsed their pre-recession levels, while arts and cultural organizations and those focused on building economic prosperity have not fully recovered.

Individual Giving Leads the Way

Individual giving accounts for nearly three-fourths of all charitable giving ? far ahead of earned revenue, institutional support and investment returns. Below you will see that individual giving experienced a similar drop off during the recession, but rebounded earlier and more dramatically than total revenues shown above. Based on this graph, organizations in all focus areas have met or are close to meeting their pre-recession levels.

Read more from GiveRichmond’s “Smart Giving” blog post here.

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