Money Talk Daily

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. More than 93% of nonprofits are experiencing notable declines in charitable donations. The Bridgespan Group, a nonprofit consultancy organization, says that not only is private funding drying up, so are many others.

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. Typically, Thanksgiving through to Christmas is the peak time of the year for the charity. Major George Hood, Chief Communications Officer for the Salvation Army, 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. A shortage of people traveling the streets to buy, means a shortage of people passing by the red-kettle ringers. Hood continued, “That impulsive giving can be jeopardized if there is no foot traffic in malls. We are in a difficult economic spot. We have to be prepared for it. All we can do it get out there and do what we do and know that the American public has never let us down.”

Service organizations suffer

Another sector braced for a lack of funding is service organizations. Karen Pushaw, director of a soup kitchen in Philadelphia, 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. Smaller non-profits are failing, or they’re crippled and unable to continue their efforts. 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 studying the past, to see what to expect. 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.

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