Atlantic Canada’s independent voice on economic issues

Nonprofit impacts

Nonprofits under pressure during the Great Shutdown - April 8, 2020 

As we continue to witness the unfolding economic consequences of the Great Shutdown, due to COVID-19, one sector that is often overlooked is the nonprofit sector.

APEC estimates there are about 13,000 nonprofits in the Atlantic region, accounting for $2.4 billion GDP. These organizations employ 45,000 people, over 4% of the region’s workforce. They help serve those who are disadvantaged, facing health challenges and many other social needs.

As our recent report on nonprofits in Nova Scotia highlights, these organizations face challenges at the best of times: inadequate and uncertain funding, a heavy reliance on volunteers, low wages which make it difficult to attract and retain workers, and limited resources for IT, strategic planning and governance.

The Great Shutdown, brought on by measures to stop COVID-19, has created additional challenges for this sector, confirmed in a recent survey of Nova Scotia nonprofits:

  1. Revenues are down
    Nonprofits often raise funds through events, which are now not able to be held in person. Individual and corporate donations will also be lower as individuals and organizations struggle with reductions in their own incomes.

     
  2. Volunteering is down
    Volunteers annually donate over 160 million hours to nonprofits in Atlantic Canada. In Nova Scotia volunteers account for 60% of the total hours worked, paid or unpaid. However, volunteering is down due to safety concerns, unexpected childcare needs and individuals self-isolating or choosing to stay home as per government health directives.

     
  3. Operational challenges have increased
    Many nonprofits are small with two out of three in Nova Scotia employing less than 10 people. They have limited financial, IT and staff resources to adjust to remote working, shift to online fundraising, and other operational adjustments necessary to continue operating during this pandemic.

     
  4. Demand has increased
    For some nonprofits, such as food banks and those providing mental health services, demand has increased due to job and income loss facing individuals and increased stress and anxiety.

It has been encouraging to see federal and provincial governments ensure that non-profits and charities are also eligible for the various financial support programs being put in place and provide specific funding for organizations such as food banks.

In this video commentary, I highlight some additional steps:

Governments should guarantee and quickly advance funding for the upcoming year to provide immediate cash flow and financial stability to help nonprofits navigate this pandemic.

Corporations that can maintain their financial support should do so; others should enquire if there are other ways they can provide support.

Individuals should also maintain their personal giving if possible and enquire how they can continue to volunteer or support charities and nonprofit organizations.

 


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