This is certainly a strange time in which to do NPQ’s annual issue on philanthropy. What I really want to do is yell “The sky is falling!” but that is probably an overstatement. The sky is not falling exactly—just parts of it.
As I have said previously, this recession is not an equal-opportunity experience. Some organizations have been walloped by serious declines in philanthropy, but such reductions rarely happen in a vacuum; they are accompanied by increases in need, cuts in public funds, reductions in clients’ ability to pay, increases in local-service fees, and a host of other factors.
And what this means is that organizations all over the country are beginning to fail. A recent GuideStar survey reveals that 8 percent of respondents believe that they are in imminent danger of closing. This proportion of our sector comes weirdly close to validating Paul Light’s original projection in his winter 2008 NPQ article “Four Futures” that, during this recession, as many as 100,000 nonprofits could close.
Some organizations handle this instability by “mothballing” operations until they can regain footing or fully consider their options. Some are eviscerating their staff—starting sometimes, surprisingly, at the top. To me, these moves suggest organizations’ growing acceptance that incremental strategy may be an insufficient response to the challenge of these times. But I admit, this is just my interpretation.
Some welcome this is!
But even in this atmosphere of decimation, some organizations have done very well, even breaking their own fundraising goals and records. Some United Ways and capital campaigns, for example, have far exceeded their own targets, while others wane. These successes are not so much tied to excellence and accuracy of purpose as is to local economies, a connection between purpose and the monied classes, and the robustness or vulnerability of a particular field of work.
But many nonprofits inhabit a middle ground where they have found that they can—with some vigilance, cuts, and shifts in strategy—survive to continue their work. It is to all these organizations that we dedicate this issue of NPQ: those trying to figure out whether hiring a development director makes sense or how to approach donors more effectively even in this time of scarcity.
Not to be Debbie Downer, but this recession is likely to extend for quite a while. We hope that all of you are thinking through your options well ahead of any crisis moment you might face and that your questions include first and foremost this question: “What is best for those we serve?”