New survey results shed light on the state of Ohio nonprofits

Monday, November 9, 2020
As we enter the eighth month of the pandemic and witness various states of recovery throughout our communities, the nonprofit sector – which often acts as a safety net for our community’s most vulnerable – continues to suffer. According to federal data, there are 40,521 nonprofit charitable organizations in the state of Ohio, most of which are public charities. Nonprofits contribute jobs, as the third-largest industry in Ohio, and they strengthen communities through direct services, economic development and enrichment through arts and culture.  

The COVID-19 pandemic has impacted Ohio nonprofits’ ability to provide services, continue operations, collect donations/revenue and carry out their missions. During this pandemic, nonprofits are increasingly expected to do more with less. In order to identify the greatest needs of the state’s nonprofit sector during this public health crisis, the Ohio Attorney General’s Charitable Law Section, Philanthropy Ohio, the Ohio Association for Nonprofit Organizations and The Ohio State University launched The Ohio Nonprofit COVID-19 Survey Project. The first wave of the survey began in April 2020 where over 7,500 public charities in the state responded about their needs and concerns during the crisis. The second wave concluded in August with 3,692 answering the survey, expressing their continued need for resources.  

Read the full survey results and hear from the report’s chief author – Erynn Beaton, assistant professor
for The Ohio State University’s Glenn College of Public Affairs – at The State of Ohio’s Nonprofits 
webinar on Tuesday, Nov. 17 at 1 p.m.

Nonprofits compelled to do more with less 
As nonprofits continue to serve the community during the pandemic, the report found that the majority are offering services in a reduced capacity – either moderately reduced (28%) or severely reduced (33%). Only 15% are operating at the same capacity, while 8% have increased capacity. Of the organizations that are providing services, two-thirds are delivering services differently than they normally would, like in a remote setting, which suggests that nonprofits are working hard to serve their beneficiaries in any way that they can. Since April, 62% have increased their service level while 13% have maintained the same level and 24% have decreased their service level. In addition, the top two nonprofit concerns are disruption of services to clients and communities and people’s health.

                                

Cutting and altering nonprofit operations
The biggest operational changes that nonprofits have implemented are conducting board meetings virtually, restricting travel and cutting administrative expenses. Already, 8% have closed their doors indefinitely, 10% are planning to or considering it and 7% are planning to or have merged with another organization.

Roughly 14% of nonprofits responded that they have cut or furloughed staff. About half of nonprofits have kept their full-time staffing levels the same or have just had minor cuts, while 27% have laid off most of their full-time staff and 44% have laid off most of their part-time workers. 

Paycheck Protection Program (PPP) loans were designed to help business keep their workforce employed during COVID-19. This survey found that only a quarter of responding nonprofits applied for a PPP loan. The remainder did not apply because the organization was either ineligible (48%) or made the choice not to (29%). More than half found the process somewhat to very challenging and only 22% found it easy. The average loan size was $280,000, but the vast majority of nonprofits don’t know whether their loan will be forgiven. 

Nonprofit revenue is decreasing
Many nonprofits rely heavily upon individual donations, which have been hit hard during the pandemic. While 12% reported an increase in donations, half have seen a decrease with 8% experiencing retracted pledged gifts. Many nonprofits grow revenue by charging fees for services, but a majority (86%) have also seen a decrease in this earned income as well. 

Though a quarter said they are seeking new sources of income, very few have been successful. Less than 1% have gained additional individual donations, corporate donations, earned income, membership dues, investment income and donor advised funds; 1.2% received additional foundation grants; and only 1.6% received new government grants or contracts.

About the survey
Wave 2 respondents to the survey reflect the sector’s diversity and the sample includes organizations of all sizes and from all regions of the state. The largest subsector represented was human services (33%) with strong representation from the arts, education, health and environment. Like the sector at large, most nonprofit respondent organizations were small with about half having an annual revenue of $50,000 or less and most having no staff. 

In ascertaining nonprofit composition, of particular concern is board diversity. Nonprofits, on average, reported that 15% of their board seats are filled by people of color. However, the average is skewed by a small proportion of nonprofits that have 100% of their board seats filled by people of color. In actuality, over half of responding nonprofits have zero people of color serving on their board.

To dig in deeper into the data and survey learnings, Philanthropy Ohio is hosting a webinar with lead report author and The Ohio State University’s Glenn College of Public Affairs Assistant Professor Erynn Beaton. Register now to attend The State of Ohio’s Nonprofits webinar on Tuesday, Nov. 10 at 1 p.m.

Jessica Howard
Manager, Communications & Membership 

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