Grassi Nonprofit Survey Reveals Resilience Amid Rising Demand and Costs
NEW YORK, October 23, 2024 – Grassi, a leading provider of advisory, tax, and accounting services, today released the results of its comprehensive 2024 Nonprofit Industry Survey. The study, which recently surveyed 160 nonprofit leaders across several sub-sectors, including Social Services/Community-Based Organizations, Healthcare and Education, reveals a sector demonstrating remarkable resilience in the face of increased demand for services and rising operational costs.
Overall, 73% of respondents said demand for their programs and services has risen in the past 12 months, with just 4% reporting a decrease. Accordingly, 81% reported higher operating costs in the same period, with an average cost increase of 15%.
“Our survey results highlight the nonprofit sector’s resilience and adaptability in the face of increasing demands and financial pressures,” said David Rottkamp, Partner and Nonprofit Practice Leader at Grassi. “While the challenges are significant, we’re seeing nonprofits leverage technology, strategic partnerships, and innovative funding approaches to continue delivering vital services to their communities.”
Other key findings from the survey include:
- As demand and costs have continued to increase for nonprofits, only 45% of nonprofits have seen their funding levels increase, 31% have yet to see any change, and 21% have seen a reduction in funding.
- The top initiatives of nonprofits are increased fundraising and development initiatives (66%). They have also implemented new technology (59%) to improve efficiency and have instituted new programs and services (51%).
- Staff recruiting and retention remain significant challenges for nonprofits, with 56% saying they have difficulty attracting and retaining employees, particularly in the healthcare and education (68%) sectors.
- Boards of directors excel at being mission-driven, focusing more on the mission than financial health. 82% of respondents said their Boards understand their mission, vision and core values. However, only 48% of nonprofit Boards review profit and loss statements at the program level, and only 44% of social services/community-based organization Boards regularly monitor cash flow projections and liquidity.
- Nonprofits are embracing technology, with artificial intelligence (AI) tools expected to see the highest growth in adoption over the next 12 months. Currently, 31% of respondents use AI, and 25% plan to use AI in the future.
- Cybersecurity poses an opportunity for improvement in the industry. Overall, 53% believe their data is completely protected, and 45% of respondents say they are completely confident in their ability to respond to a cybersecurity event around the clock.
Nonprofits are proactively navigating the current environment and maximizing their budgets. They prioritize identifying and analyzing other funding opportunities, using new technology to bring efficiency, and instituting new programs and services. These strategies, coupled with partnerships with other organizations for service delivery and, in some cases, scaling back their programs, instill confidence in the industry’s ability to adapt and thrive.
A complete copy of the survey report is available for download here.
Please contact us to speak with a Grassi Nonprofit advisor.
