Downturn forcing charities to put the brakes on recruitment 29/04/09

Despite a growing demand for essential services provided by the voluntary sector during the recession, the economic downturn is forcing charity leaders to put the brakes on recruitment levels, the NCVO latest quarterly Charity Forecast Survey reveals.

Almost a fifth (19%) of charity leaders surveyed for the report plan to decrease the number of paid staff, with over half (51%) maintaining staffing levels.

The figures are in marked contrast to the previous quarter (October to December 2008) where over half (56%) of those surveyed planned to increase paid staff numbers.

The forecast, based on responses from chief executives, directors, trustees and senior managers of charities and voluntary sector organisations, also shows that almost nine out of ten (88%) charity leaders believe the economic conditions in the voluntary sector will be negative over the next 12 months.

For the first time since the survey was launched in March 2008, none of the respondents believe the economic conditions within the UK will improve over the next 12 months, with 97% reporting a negative outlook for the UK economy.

Despite the gloomy economic outlook, almost half of those surveyed (48%) plan to expand their services.

There is also a higher expectation among charity leaders for collaboration over the coming year, with almost three quarters (74%) expecting collaboration to increase.

Stuart Etherington, chief executive of NCVO, commented: “The recession is having a significant impact on confidence levels within the charity and voluntary sector. With the economic outlook for 2009 looking increasingly bleak, the need for the charity and voluntary sector to make the best use of their resources and develop their entrepreneurial spirit, has never been greater.

“While the forecast shows areas of pessimism, charity leaders remain bullish in others. It’s encouraging to see the sector is responding to the challenge by planning increased collaboration and an expansion of volunteers. NCVO is working with the Government to help ensure charities and voluntary groups continue to provide essential frontline services during these difficult times.”

Of the 144 sector leaders surveyed, the resultsshowed:

50% of sector leaders fear their organisation’s financial situation will worsen over the next 12 months – a drop of 19 percentage points from May 2008.

Almost half (49%) feel that government policies will worsen the operating environment for their organisation. Many respondents expressed concern about cuts to funding for essential services, as well as providing the same level of services with less resources.

Two in five sector leaders (42%) plan to increase their organisation’s expenditure over the coming year. Levels of increased expenditure have remained steady from the previous quarter, with a drop of only
4 percentage points.

Volunteers continue to be seen as vital to the sector, with almost half of respondents (49%) planning to increase volunteer numbers.

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