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November 26, 2020
COVID-19 Crisis Has Cost Mass. Nonprofits Minimum of $8.6B
Fundraising Down

June 19, 2020— Massachusetts nonprofits have lost at least $8.6 billion in revenue due to the COVID-19 pandemic, the state's nonprofit trade association announced yesterday, an amount equal to approximately one-quarter of annual wages and salaries paid to all nonprofit workers statewide.

According to the Massachusetts Nonprofit Network (MNN), the coronavirus pandemic has caused 52% of Bay State nonprofits to reduce their workforce.

The finding was based on a survey of 1,500 responses to a recently completed survey, MNN said.

In addition to the workforce cuts, 88% of survey respondents said the crisis has caused disruptions in services to clients and communities, 78% experienced revenue decreases, and 44% reported increased demand for services.

In addition, according to MNN:

  • 20% of respondents indicated that they were laying off staff, while 32% more were reducing staff hours and/or pay.

  • Respondents said, on average, they could survive 11 months based on their current cash flows.

  • 86% of artistic/cultural nonprofits and environmental nonprofits said they had lost revenue as a result of the pandemic, the highest reported incident of revenue loss among sub-sectors.

  • Arts and culture nonprofits was also the sub-sector reporting the highest percentage (43%) of workforce reductions in the form of layoffs, furloughs, or cuts in pay.

  • 25% of youth and education organizations said they anticipate future workforce reductions, the highest of any sub-sector.

“Nonprofits support the most vulnerable, strengthen every community, and generate essential economic activity, which makes the massive impacts of COVID-19 on the sector very troubling,” said Jim Klocke, CEO of MNN. “Because of this, it’s in our collective interest to ensure that the nonprofit sector remains strong during, and after, the COVID-19 pandemic.”

According to the survey, nonprofits in the Berkshires, Pioneer Valley, and Greater Boston reported the highest percentages of respondents pursuing philanthropic relief.

Nonprofits in northeast Massachusetts reported the highest share of respondents applying for Paycheck Protection Program loans, and nonprofits in central Massachusetts reported the highest percentage of respondents applying for Economic Injury Disaster Loans.

In 2016, MNN reported wages paid to nonprofit workers in Massachusetts totaled $30 billion, a figure that today would be around $40 billion.

To help lessen the impacts of the pandemic on the Massachusetts nonprofit sector, MNN said it is advocating for policy responses that include financial relief, unemployment insurance forgiveness, and expanded charitable giving incentives.

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