Improving Retention in Not-For-Profit Sector

Organisations in the Not-for-Profit sector have struggled to both attract and retain talent over the last few years. While the impacts of the global pandemic and the 'Great Resignation' have been felt by organisations of all stripes, this sector has arguably been hit the hardest. We have dug into the data from 2020-2023 to understand what's been going wrong and what needs to be done to put this right. 

The impact of COVID-19 on the nonprofit sector cannot be overstated. According to the most recent annual report from the UK Charity Commission, nearly all charities were impacted by the pandemic, with 90% reporting that it had impacted their service delivery, finances, or staff. Nearly half of those organisations have had to adapt the way they delivered their services or were forced to cut either staff or spending

One in four charities with incomes of less than £10,000 paused their activities completely. More broadly, market research shows that a quarter of all non-profits in the UK lost 40% or more of their income during 2020, costing the sector as a whole £10 billion.

Of course, with the pandemic having lifted, and with full year free of any lockdowns having now passed, one would expect to see the picture starting to clear up. However, that same report from the Charity Commission notes that both income and spending were down in 2022 compared with 2021, with the
number of registered charities in the UK also falling over the past year. A Salesforce trend report of non-profits in both the USA and Europe showed that as many as 68% of non-profits have seen a decrease in funding.

While these figures look bleak, they are broadly comparable to those in other sectors; nobody has been immune to the shocks and uncertainty caused by the last few years. Nor has the charity sector been able to escape another of the big trends that has disrupted organisations of all kinds in the aftermath of the pandemic: a sharp increase in employee turnover.

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