U.S. Nonprofits Struggle to Meet Fast-Climbing Demand for Services

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 today by Nonprofit Finance Fund (NFF). 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.

Key findings include:

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.

“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.

Yet 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.
• 36% relied more on volunteers.

Additional information is available on the Nonprofit Finance Fund website.