Public Policy Forum Blog

Local nonprofits still feeling impacts of recession

The 14th annual "Report Card on Charitable Giving" - released by the Forum today in partnership with the Greater Milwaukee Foundation - shows moderate improvement over last year in the fiscal health and general outlook of Metro Milwaukee nonprofit organizations. Nonetheless, nonprofit leaders continue to express a healthy dose of pessimism toward the state of philanthropy and continue to feel the impacts of the economic downturn in varied ways.

The report card is based on a comprehensive survey of nonprofit organizations in southeast Wisconsin. More than 150 nonprofits responded to this year's survey, with a little more than half (52%) from the human services sector, 17% from arts and culture, 16% from education, 10% from health organizations, and 3% from the environmental sector.

Among the key findings that emerged:

  • For the second year in a row, nearly two-thirds of respondents feel that economic conditions are causing local giving to be less generous than usual. The 2010 result of 66% is slightly improved, however, from the 68% who felt that way in 2009.
  • More than a third (38%) of this year's respondents report decreased total revenue, while half report increased total expenses.
  • Half of the respondents feel they are financially healthy but vulnerable in the future, an improvement over the 57% who felt this way in 2009. Meanwhile, 30% feel they are financially healthy with no foreseeable problems in the near future, also improved from the 24% who responded that way in 2009.
  • Arts and culture organizations expressed the greatest concern about their financial health among the various nonprofit sectors, with 35% reporting chronic financial problems, and another 50% reporting they are financially healthy but vulnerable in the future.
  • Survey respondents cited the need for several personnel-related actions to address budget constraints, including salary freezes (40%), reductions in benefits (20%) and lay-offs (18%). Nearly half (48%) say they have considered collaborating with other organizations and 22% say they have considered merging with other organizations.
  • A quarter of the respondents say their expectation of long-term sustainability is very high, while another 41% report it is high. Only 3% have low expectations for long-term sustainability.
  • Nearly half (46%) of the respondents say they expect gifts from corporations to decline, while 43% expect gifts from individual donors to decline and 41% expect foundation grants to decline.

An executive summary of this year's report card and a copy of the full report can be accessed here. The report card is published and sponsored by the Greater Milwaukee Foundation, and co-sponsored by the Donors Forum of Wisconsin, Faye McBeath Foundation and United Way of Greater Milwaukee.

Rob Henken