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Charities in the US

In the US there are over 1.2 million charities and other nonprofits hoping to reach their financial goals this year. Unfortunately, due to the recession many are predicted to fall short. Around 93% of nonprofits anticipate declining charitable donations. According to The Bridgespan Group, a consulting organization for nonprofits, not only is funding from citizens getting smaller, but other forms of funding are being cut drastically.

The Salvation Army suffers

Everyone has seen them on street corners and in front of businesses. The Jolly Santa rings the Salvation Army bell, hoping to get a donation. Even the Salvation Army is facing a shortfall. Normally Thanksgiving through Christmas is the peak season for the charity to raise funds. Major George Hood, the Salvation Army’s Chief Communication Officer, said, “Fundraising is very difficult in this economy, yet we know that there are people suffering in all 50 states.”

Since the recession, spending has declined drastically. Less people going around to shop, means less people that will pass by the Santas with the bells. Hood continued, “That impulsive giving can be jeopardized if there is no foot traffic in malls. The reality is that we are in a tough economic period. We have to be prepared for it. We have to bear in mind that things will eventually turn around, keep on keeping on, and don’t leave the good work undone.”

Service organizations suffer

Another sector braced for a lack of funding is service organizations. The director of a soup kitchen in Philadelphia, Karen Pushaw, said, “More people are seeking services at the same time as fewer people are able to contribute.” Service organizations are expected less funding, along with increased demand for help from those without. One facility in New York City called Nazareth Housing, a 58-bed homeless shelter, has been operating at full capacity since June of this year.

The organization does not expect to meet its budget, but has a “no one turned away” policy that presses them to stay open until there is no room available. Executive Director Michael Callaghan said, “There are a variety of fiscal stresses on nonprofits. Many small not-for-profits are failing, or they are so reduced that they are unable to do their missions. We are going to see more people go out of business, which will add to unemployment and leave gaps in services.”

When will charities and service organizations mend?

Industry experts are looking to the past as a gauge on how the charitable market will recover. In the Great Depression it took three to four years for charitable giving to return to normal. The analysts and experts aren’t ALL doom and gloom – since the per capita income has risen since the 40s, the recovery could be a lot quicker. The recession crippled businesses and organizations, but hope of a recovery is stronger now than it was previously. It’s likely that service organizations and charities will get closer to normal once the economy turns around.