Study shows small nonprofits are hit the hardest during pandemic

• Date: 01 February 2021
• Published date: 01 February 2021
• DOI: http://doi.org/10.1002/nba.30933

NONPROFIT BUSINESS ADVISOR FEBRUARY 2021

6© 2021 Wiley Periodicals LLC • All rights reserved

DOI: 10.1002/nba

Nonprot Research

Study shows small nonprots are hit the hardest

during pandemic

As the pandemic wears on, industry surveys con-

tinue to document the impact that the coronavirus

has had on the charitable sector. In the rst half of

2020, research from the Charities Aid Foundation of

America spotlighted a surge in corporate support for

charities battling a drop in donations from individual

donors. A later study by Candid and the Center for

Disaster Philanthropy showed that donors of all

types provided an unprecedented amount of giving

specically to meet immediate needs and services

arising from the COVID-19 pandemic in the United

States and abroad.

Despite these somewhat optimistic ndings, re-

search shows that one segment of the philanthropic

community is especially hurting for funding: small

nonprots.

According to a study by DonorPerfect, a fundrais-

ing and donor engagement platform, very small non-

prots experienced a signicant drop in giving—down

22% year-over-year in the most recent three-month

rolling average—as a result of the pandemic. This

group, which brings in less than $235,000 in donations

per year, saw a drop twice as severe as the “large”

nonprot group in the study, those bringing in over

$775,000 in annual donations. The middle category,

organizations with annual donations ranging from

$235,000 to $775,000, saw an 18% drop year-over-year

for the same period. In short, the smaller an organiza-

tion is, the harder they have been hit by the pandemic.

The nonprot’s program area/focus is also a major

factor in the extent to which they’ve seen donations

stumble. All sectors showed a decline in giving as

a result of the pandemic, but the arts, culture and

humanities (down 29%) and education sectors (down

23%) were the most severely impacted.

Meanwhile, human services, faith-based and public

and societal benet sectors (down 10%, 6% and 9%,

respectively) were the least impacted, presumably be-

cause their fundraising efforts could be more directly

connected to addressing the societal impacts of the

pandemic, the study found.

To put those numbers in perspective, the sector

as a whole tends to see positive growth in donations

year-over-year of 3% to 10% for the three-month

period studied (see below).

Nonprots are taking a series of approaches to ll

their funding gaps, but with limited staff and curtail-

ments on their operations caused by the pandemic,

there’s a limit to what they can do. For the smallest

organizations especially, jumping through the var-

ious hoops that foundations and corporate giving

departments require of their grantees can be especially

daunting; however, the data show it’s these groups that

are hurting the most as the sector struggles through.

For their part, experts say, funders could take a few

simple measures that will help these groups: namely

by specically earmarking grant dollars for smaller

charities and then streamlining the application pro-

cess and other requirements that take up resources

badly needed for operations.

To read the DonorPerfect report in full, visit https://

www.donorperfect.com. ■

provide seed funding to reduce barriers to ad-

vancement in health professions and increase the

number of Black professionals in a wide variety

of health care careers.

• A $10 million grant to Year Up to support its

training and internship program, providing more

than 600 young adults with technical skills training

that is relevant and aligned with industry demand.

• Expanding educational opportunities for his-

torically underserved youth and young adults. The

foundation’s initial investments in this area include:

• A $1.5 million grant to Providence St. Mel

School to fund scholarships for high school stu-

dents living in Chicago's Southwest side, based

on nancial need and academic potential.

• A $7 million grant to the National Urban

League's Project Ready Mentor, to support a

mentorship program for Black Americans and

other historically underserved youth.

Additional grantees will be determined as the

program rolls out, the company said.

For more information on the initiative, visit https://

www.abbvie.com. ■

INEQUALITY (continued from page 3)