One-third of Bay Area Nonprofits Struggling to Survive, According to United Way Survey

SAN FRANCISCO, May 28, 2009 — One third of Bay Area nonprofits are concerned they may cease operations within the next year, according to United Way of the Bay Area’s 2009 Nonprofit Pulse Survey. Correspondingly, 34% report they have two or fewer months of operating expenses in reserves.

“While the findings from our survey are sobering, they motivate us to work even harder to find the most efficient and effective ways to serve our community,” said Anne Wilson, CEO of United Way of the Bay Area. “Nonprofits are working together more creatively and collaboratively, as we are increasingly called upon to do more with less. This renewed energy around collaboration and partnership might be one positive emerging from these lean times.”

As the recession causes more Bay Area residents to seek help, 64% of local nonprofits report an increase in demand for their services. While 31% of nonprofits indicated they have increased services to address demand, 23% reported they have reduced services. Twenty-six percent said they have collaborated with another nonprofit during the last six months to provide services.

Tough Times Ahead
While many nonprofits have employed cost-cutting measures during the last six months, they continue to brace for tough times ahead:

77% of survey respondents expect service demand to increase in 2009, with 45% of total respondents expecting a “significant” increase.

20% indicated they have laid-off staff during the last six months. Of those organizations, 37% are considering further lay-offs.

25% have reduced staff hours during the last six months. Of those organizations, 30% are considering lay-offs, and 59% are considering reducing staff hours further in the next six months.

44% plan to dedicate more staff time to fundraising, indicating employees will have less time to deliver services.

Other highlights from the survey: