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Sunday, December 7, 2008

Churches Consider Response to Economic Turn

Cutbacks in gifts to non-profits are especially common among the one-quarter of the population who are immersed in "serious financial debt" (49%). It is also a common response among adults who are feeling "stressed out" (39%), African Americans (36%), downscale households (36%), and registered Democrats (36%)

Among those who are decreasing their giving to non-profits, 53% are simultaneously decreasing their generosity to churches or other religious centers, as well.

Other Responses to Financial Suffering
Americans have responded to the nation’s economic woes in other ways besides reducing their generosity. So far, 5% have moved to less expensive housing. This has been especially common among people with "serious financial debt" (14%), people under age 25 (13%), and downscale adults (11%).

Potentially Devastating Impacts
George Barna, whose company conducted the survey, commented that the economic woes hitting families will be felt in a major way by churches and non-profits by the end of the year. "Most non-profits and churches count on the fourth quarter of the year to produce at least one-third of their annual income. Deficit spending is common during the first three quarters, with the expectation that holiday giving will enable the organization to meet its budget projections. This year is likely to be very different. The giving patterns we’re witnessing suggest that churches, alone, will receive some $3 billion to $5 billion dollars less than expected during this fourth quarter. The average church can expect to see its revenues dip about 4% to 6% lower than would have been expected without the economic turmoil. We anticipate that other non-profit organizations will be hit even harder."

Barna encouraged church leaders to embrace a new mindset for their financial projections. "With a large share of congregants expecting the nation’s economic woes to drag on for several years, it would be wise for churches and non-profits to reconfigure their financial models and plan to spend more cautiously over the coming two or three quarters," he explained. "Even if a congregation continues to grow numerically, this is not a good time to use dated financial projections and models. People’s attitudes about generosity have been altered, as shown by their immediate donation behavior. We anticipate that a greater percentage of church-goers will decrease both their giving levels and frequency over the next year or so. This is a time for church leaders to demonstrate restraint and wisdom in their financial decisions."

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