Nonprofits play a vital role in transforming and improving life for individuals and neighborhoods—serving families during economically challenging times, promoting solidarity, providing international humanitarian aid to victims of war, and strengthening their communities. However, nonprofits are facing unprecedented financial challenges that can disrupt their ability to provide critical services to those in need.
2023 was only the fourth time in four decades that donations did not increase year over year.
In our annual 2024 State of the Nonprofit Sector Report, FORVIS explores how organizations are handling budget concerns amid economic uncertainty to help nonprofits move forward with clarity and increase their impact.
Key Findings
Based on data from more than 325 nonprofit professionals across the U.S., our report found:
- Nearly three out of four (74%) nonprofits have job vacancies.
- Of survey respondents, 71% saw an increase in demand for programs and services.
- More than two-thirds (68%) of nonprofits plan to cut programs & services in the next one to two years.
Consistent with last year’s report, inflationary pressures and staffing issues top the list of concerns for nonprofit leaders. Budget cuts and workforce shortages affect the effectiveness of programs and limit outreach to supporters and mission partners.
The top 5 challenges nonprofits face:
- 46.48% report rising operating expenses
- 41.59% report a lack of adequate finances/resources
- 36.97% report limited staff capacity
- 29.52% report difficulty recruiting and retaining quality staff
- 29.52% cite economic downturn/inflation
Organizations of all types continue to grapple with the dilemma of how to maintain free or affordable services to those in need while offsetting the effects of inflation and rising costs of goods and services. Except for Mutual & Membership Benefit organizations, every type of organization surveyed increased its fees for programs and services. Our 2024 findings also saw a decline in the percentage of organizations with more than one year in reserves since the prior year’s survey.
Learn More in Our Full Report
FORVIS understands the vital role nonprofits play and is committed to supporting the industry with resources like the 2024 State of the Nonprofit Sector Report to help them move forward with clarity, while staying true to the organizational mission.
For more insights, download a copy of the report today.