Is Britain’s Economic Recovery Having Positive Effects on Charitable Work?

BradYoung04 By BradYoung04, 14th Jan 2015 | Follow this author | RSS Feed
Posted in Wikinut>Money>Economics

How economic recovery can help spur charity donations


In 2008 the recession hit the world’s largest economies, putting strain on almost all aspects of the goods and services industries including both public sector and private enterprise. 6 years later, and the British economy is recovering slowly. A further 2.7% growth is forecast for the British economy in 2015, steadily slowing down to 2.5% growth in 2016.

Although UK economic growth was deemed to be a great achievement in 2014 by the chancellor, British wages, energy and housing prices have all stayed the same, meaning these differences have been seldom felt for Britain’s working and middle class. Notably, charitable organizations have been suffering significantly, with demands for their services increasing and funds severely decreasing. Following such a challenging few years for the UK, has this period of economic recovery improved prospects for Britain’s charities?

The Current Climate

The downturn in the economy, with prices for services increasing whilst wages stayed the same, meant that people usually had less disposable income to give away. However, during the initial point of economic upheaval in 2013, a study conducted by the Charities Aid Foundation (CAF) showed that average individual donations were up from £2 to £23, and the number of those who said they donated monthly rose from 55% to 57%.

In further studies from the CAF, the divide between the North and South during Britain’s economic recovery was highlighted in charitable spending statistics, with 11% of people based in the South planning on continuing or increasing their donations, whilst only 6% of people based in the North planned on doing the same. It is interesting to note how great an effect regional economic division can have on charitable spending, and highlights how closely the charitable sector is linked to the UK’s relative economic success.

Overcoming Economic Adversity

Despite the general public having less money to give to charities during the economic downturn, they have developed other means of raising funds using initiative and creative ideas; community engagement, embracing technology (especially the internet) and fun fundraising ideas have led to individuals being able to work together to raise money without having to spend almost anything in return. A return to grassroots campaigning signals a shift in how people approach spending in relation to fundraising, however this is just one of the significant approaches in response to the economy.

Efforts to sustain funding have also given rise to multiple charitable organizations employing private companies to raise money, including telephone fundraising which has grown significantly since 2012. Contracting outside agencies has been viewed as an essential part of maintaining normal operations for a charity, highlighting the hindering effect that the economic downturn has had. These different fundraising approaches show inherently opposite approaches to the difficult times that charities have been experiencing, and are likely to change as the economy recovers.

The Road to Recovery

As the UK economy continues to grow, it is difficult to ascertain whether the current models of fundraising will still be as effective. The continued utilization of online channels including social media will only increase, most likely leading to new forms of fundraising. The easing economic strain gives charitable organizations the opportunity to be more flexible and creative in their fundraising methods, as well as giving the British public more funds and capabilities to support these approaches.

Key findings in a research project conducted by the Institute of Fundraising predicted that the full consequences of the 2008 economic downturn would not be felt by charities for some years afterwards, and that “charities should plan on the basis that there was a medium term shift in the economy and funding environment”. The prediction highlighted the impending difficulties of a struggling economy, and many aspects of British public and government spending began to negatively affect charitable organizations.

But as public and private spending increases, the positive effects of economic recovery should, in a very similar fashion, take a few years before the beneficial consequences are fully realized. The ability of these charities to adapt will be crucial to the success of their operations as the economy improves.


Britain, Charity, Economic Recovery, Economy, Fundraising

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author avatar BradYoung04
I am a MBA grad who can transform your business. Follow me for straight talking insights into running successful businesses in a fast paced world. I am always working or surfing in the Californian sun

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