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How Unrestricted Giving Empowers Nonprofits

Posted by Staffing Advisors on November 16, 2022

MacKenzie Scott announced on Monday that with the help of her team, she gave close to two billion dollars to “343 organizations supporting the voices and opportunities of people from underserved communities.” Unrestricted or general operating support giving can be transformative in the immediate, unlocking the ability to allocate funds wherever they are needed most. But this kind of giving can also have less obvious effects on staffing, creating sustained growth into the future. With Giving Tuesday 2022 fast approaching—a source of unrestricted fundraising for nonprofits nationwide—this is a great time to think about the long-term impact of philanthropy on nonprofit teams.

The Nonprofit Hiring Crunch Continues

As in many industries, there has been a shortage of employees across the nonprofit sector for the past couple of years. With many organizations already operating under tight budgets and limited staff, the shortage only increases the potential for burnout, threatening their ability to help the communities they serve.

A 2021 Council of Nonprofits survey noted that of 1000 organizations included, a “troubling 26% responded that they had job openings for 20-29% of their positions…16% reported vacancies greater than 30%.” The same study notes that “79% identified salary competition as a factor for filling job openings.” Salary competition has become a widespread issue for many organizations struggling to maintain their salary budgets.

While many nonprofits have made significant gains since dramatic job losses in 2020, recovery isn't universal. In a 2022 update to their survey, the Council of Nonprofits emphasized that the problem continues, “organizations without adequate levels of personnel cannot deliver the same volume of services, much less respond to growing demands.” And funding restrictions can limit their ability to offer competitive salaries.

Retention Strategies Require Funding Too

Nonprofits are working to keep their current employees happy, with 91% “prioritizing culture and employee engagement,” according to a 2022 NonprofitHR Survey, many through creative strategies specific to their communities. For example, Waban is supplementing affordable housing after surveying staff about what they need, noted in a recent Chronicle of Philanthropy article. But even these types of initiatives require funds that aren’t earmarked. Unrestricted funding enables nonprofits to be nimble and respond to their current employees' needs as the job market shifts.

The Center for Effective Philanthropy reports that only about 20% of overall funding has this flexibility. More often, nonprofits get funding for specific projects and timeframes. That’s why unrestricted funding can make such a dramatic impact. With funding that can be used to hire top leadership, meet the evolving needs of current employees, and bolster reserves, nonprofits can create a more secure work environment and meet increased service demands without risking burnout for their teams.

Empowering Choice This Giving Season

At Staffing Advisors, we are proud to partner with many organizations that work to make the world a better place for others. And we are grateful to be able to contribute to a more sustainable future for these organizations by helping them hire and retain terrific employees.

Few of us have the ability to give at MacKenzie Scott’s scale. But as you think about philanthropy through the holiday season, think about the lasting impact contributing to an unrestricted fund can make. Gifts of any size can add up to make a big difference, empowering organizations to make choices that best serve their needs. And right now, the areas of greatest need for many nonprofits are staffing and improving benefits for current employees. As Scott put it, “I needn’t ask those I care about what to say to them, or what to do for them. I can share what I have with them to stand behind them as they speak and act for themselves.”


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Topics: Nonprofit Management