Friday, March 22, 2013

How nonprofits cut budgets in difficult times

The graph below was created using Google’s graphing tools.

The horizontal bar graph shows 9 actions that nonprofits took to reduce their budgets during the difficult US economic period in 2009 and 2010.  

The data in the graph was collected in a survey conducted by GuideStar.  2011 responses were received from nonprofits.  The graph shows the percentage of responses that indicated they reduced budgets by the actions shown.   GuideStar’s report “The Effect of the Economy on the Nonprofit Sector” can be assessed by clicking here (PDF file).

A question about the data is why more nonprofits did not reduce their operating hours, which would seem a preferable strategic option.  Reducing operating hours would avoid layoffs (layoffs are a very poor strategic action) and achieve many of the other results, e.g. reducing employee wages using hourly wages.

How Nonprofits Cut Budgets in Difficult Times

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