Nonprofits continue to struggle with rising costs and battle for talent but express cautious optimism as revenues increase, Sage research finds

Nonprofits see technological advancement as a necessity to operate today, but lack the talent to make it a priority.

TORONTO, June 08, 2023 (GLOBE NEWSWIRE) -- Today Sage, the leader in accounting, financial, HR, and payroll technology for small and mid-sized businesses, released the second part of its annual Grow Together report, which found that Canadian nonprofits express optimism about their financial outlook but struggle with rising costs and securing skilled talent to help drive strategic initiatives including digital transformation.

As a follow-up to the Annual Grow Together report released in April 2023, which looked at charitable giving in Canada, the 2023 Grow Together: Building value for nonprofits in a digital economy – conducted by Léger – surveyed 120 decision makers in nonprofit organizations in April 2023 to gleam how financial pressures are affecting nonprofits and what barriers they are facing to optimize operations. The survey found that while financial pressures have eased, rising costs and closing the talent gap remain a challenge:

• Nonprofits are cautiously optimistic, seeing signs of a positive financial outlook with 42% of nonprofits experiencing an increase in revenue over the past 12 months, followed by 34% where revenue remained flat YtoY. Whereas, nearly one in five (18%) experienced a decrease in revenue.
• Largest increase in funding came from governments, with 28% of organizations experiencing an increase in the past 12 months while the biggest decrease came from corporate (25%) and individual giving (23%).
• More than half of respondents (53%) indicate that the cost of programs has increased over the past 12 months
  

To continue driving success in 2023, they are prioritizing improving their internal systems; as well as increasing their brand awareness and expanding their program offerings to better engage with current and prospective donors and volunteers. Updating their systems is vital as online donations make up the majority of funding, yet almost one in five (19%) do not have an online donation option.

“As Canadians are re-evaluating how they support charities, nonprofits need to examine how to make best use of the operational dollars available to meet the increased demand for services at an increasing cost.” Said Mark Hickman, Managing Director of Sage in Canada. “To maintain and grow their share of funding, they must advance brand awareness but also show operational efficiency.”