Inflation strains charities

In an article published this week on Really clear policy, Philanthropy Roundtable Adjunct Senior Fellow Patrice Onwuka has written that rising inflation is putting pressure on American households…and on the charitable sector. As families turn to food banks for help in unprecedented numbers, aid workers and frontline organizations are struggling to meet this growing demand.

Below are excerpts from the article titled “Inflation strains the charitable sector”:

“In America, our civil society springs into action whenever people are in need. As with other crises, shelters, food pantries and feeding programs, soup kitchens and other direct service organizations have ramped up distribution to meet growing customer demand up and down the income scale. In turn, they depend on donations from individuals and foundations to meet these needs. Yet these frontline aid workers are also being squeezed by inflation in different directions.

Unfortunately, inflation gives donors no rest. Rising food and gas prices are making it more expensive to deliver goods and services. For example, in California, spending at the Alameda County Community Food Bank has grown from a pre-pandemic monthly average of $250,000 to $1.5 million. The supply chain disruptions that have plagued our economy also persist, prompting organizations to find ways to secure food items to distribute or implement rationing of staples like meat.

Salaries are rising, but this benefit — while good for workers — puts greater pressure on nonprofit budgets. Organizations must offer more money to their employees to avoid staff departures, especially in a labor market with more than 11 million vacancies. Every additional dollar allocated for salary is one dollar less for services.

In the meantime, inflation also threatens to impact overall charitable donations. The generosity of the American people has been a palliative to the growing demand during the pandemic and other crises. Although megadonations from wealthy donors make headlines, they only represent about 5% of individuals who donate to our charitable sector.

Please continue reading “Inflation puts strain on the charitable sector” at Really clear policy.