Exploring Nonprofit Managers’ Response to Budgetary Constraints During the Great Recession

Clary Sage Lamberton

Abstract


Nonprofit organizations struggled with severe funding cuts from state and Federal governments following the Financial Crisis of 2008 and the resulting Great Recession. The new reality for many nonprofits included decreased volunteerism and donations, coupled with increased demand for services.  This longitudinal study uncovered the degree to which leaders of nonprofit organizations in Western North Carolina experienced and adapted to these environmental shifts.   Fifteen qualitative interviews were conducted with nine informants over the course of eight months.  The results reveal that prescriptive management strategies typically implemented in for-profit organizations were applied with mixed results.  While some organizations experienced growth and remained firmly invested in bettering their respective communities, some informants revealed the need to downsize facilities, reduce clientele, and require fees for services that were freely available to the community in the past.  Given the anticipation that these nonprofits will receive decreased state appropriations in the future, the practical implications of this study offer nonprofits organizations a roadmap towards adaptation.  A variety of strategies grounded in the data presented in this study will not only help nonprofit organizations thrive in a tenuous economic reality, but also expand necessary services to their respective communities.


Keywords


nonprofits, Great Recession, strategy

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