Nonprofit organizations across the United States are being hit hard by the economic crisis, as contributions from foundations, corporations and private donors diminish.
Even as demand for social services increases, nonprofits are being forced to cut staff and reduce operations, according to Crain’s New York Business.
Professor Paul Light of New York University projects that at least “100,000 nonprofits nationwide will be forced to close their doors in the next two years” due to the economic downturn, and called for foundations to increase their annual giving.
As charitable donations decline, nonprofit groups may be forced to help each other survive through strategies like back-office consolidation, strategic alliances and health- care-plan mergers.
Clara Miller, chief executive of the Nonprofit Finance Fund, which provides loans and financial services, said that a boost from foundations might not be enough given cuts in government spending.
She said that the nonprofit sector may need a complete financial overhaul, especially with regards to how much money is spent on fundraising.
–Julia Hengst/Newsdesk.org
“Financial crisis will kill nonprofits”
Crain’s New York Business, November 19, 2008