And how the sector is fighting back, across the continent
The running costs crisis afflicting the charity sector is not confined to Scotland, or even just the UK - but is affecting organisations across the continent.
New research shows that what are termed “nonprofits” across Europe are doing more with less amid a perfect storm of rising service demand, increasing workload, and squeezed income.
The finding come from the latest annual Nonprofit Pulse report by the European Fundraising Association.
Workload, raising sufficient funds, and supporting staff and their wellbeing are the biggest challenges, with just six per cent of respondents unaffected by the cost of living crisis, and a fifth (20%) concerned about the future.
Once again facing their challenges head on, many nonprofits are responding by seizing the opportunities available to them – from advances in technology and AI to greater collaboration between organisations.
Based on a survey of 671 senior representatives of nonprofit organisations from 20 nations across Europe in November 2023, the report tracks change, examining the impact of the ongoing economic crisis and how nonprofits are responding.
For the first time, it includes a focus on how nonprofits are using AI, or plan to, and their view on its opportunities and the challenges around its use. Also included are recommendations for getting started with AI, and commentary on this and other key report findings from fundraising experts.
Key Findings
Easing of pressure but biggest challenges remain
2023’s survey suggests some easing of pressure from 2022 with percentages dropping in many areas, however:
- 28% of those surveyed saw demand for services increase, while 28% saw income from donations fall, and 26% experienced a drop in supporter numbers,
- and 20% had to use their reserves, while 28% let staff go, and workload along with staff wellbeing were key issues for 37% and 26% respectively.
Sector’s response to challenges
In response to the challenges, 2023 saw fundraising strategy remain unchanged for just eight per cent of nonprofits with the vast majority responding through a variety of means:
- Almost a quarter (23%) focused on further digital development and channel diversification
- and collaboration was mentioned for the first time since tracking began in 2015 as a top area of focus, with 22% working more with other nonprofits.
Fundraising: in-person activity reignites alongside further growth in digital
Reliance on digital continued to grow in 2023 for Europe’s nonprofits and their donors:
- 19% acquired more supporters through social media and 17% through online events
- and the most popular channels for fundraising and engagement were social media (51% of respondents), website (47%), email (46%). At the same time, in-person activity rose with F2F the fourth most popular channel (39%).
Focus on AI
Gauging nonprofits’ current sentiments on using AI, the research found:
- 13% were excited andalready using AI, and 22% ‘optimistic but cautious’, while 15% said they didn’t see their organisation using AI at all
- and key concerns for both generative and predictive AI were data security and privacy, loss of human expertise and job displacement.
Commenting on the findings, Charlotte Rydh, president of the European Fundraising Association and secretary general of Giva Sverige in Sweden, said: “There is immense value in working together and sharing expertise and experience. This is something that is echoed in this year’s survey findings, which show rising collaboration between nonprofits.
“Having this pan-European view of the nonprofit sector, with its trends, challenges and opportunities, helps us all by enabling individual nonprofits to benchmark, as well as informing the work of national fundraising associations, networks like our own, and others supporting the sector.”
The report was published in partnership with the UK’s Chartered Institute of Fundraising and Salesforce.
Rob Cope, executive director, membership and operations, at the Chartered Institute of Fundraising, said: “The nonprofit sector is currently facing its biggest collective set of opportunities, challenges and risks in our lifetime.
“It’s a perfect storm of rising demand, growing workload and squeezed income that means together, as a sector, we must answer the big question of how we can all do more with less. One of the most exciting areas of opportunity has to be in new technologies and AI, which is a critical lever of change that we cannot ignore.”
The full report and its findings can be downloaded for free: Nonprofit Pulse 2024.
