Challenges and Opportunities Facing San Diego’s Nonprofit Sector

San Diego’s Nonprofit Sector

By: Pat Libby, MS, director, Institute for Nonprofit Education and Research and Laura Deitrick, director, Caster Family Center for Nonprofit and Philanthropic Research

The nonprofit sector in San Diego serves a vital, yet little understood role undergirding private enterprise. Corporations are able to attract talent not only because of the opportunities they themselves offer but because of the rich array of nonprofit institutions that reside here. These include a premier symphony and opera, several award winning theatres and an array of top flight museums. Our treasured beaches and parks are protected by nonprofit environmental organizations; and our private elementary and secondary schools are highly esteemed. Nonprofits also provide the “hidden” support that enables business to thrive by, for example, aiding victims of domestic violence, and providing social support such as subsidized elder care, day care and after school programs.

Yet, despite the responsibility placed on nonprofits to address our most critical community problems and to make our community shine, the sector remains largely misunderstood by many San Diegans. For our example, our research shows that one-third of San Diegans cannot name a single nonprofit and many are unclear about the purpose of nonprofit organizations. While most San Diegan’s believe that nonprofits deliver high quality services, fewer believe that nonprofits are efficient or spend their money wisely. The disconnect here is glaring since the largest portion of expenditures by a typical nonprofit is in the delivery of the very services that San Diegans rate so highly. Clearly the work of the sector needs to be discussed, understood, and publicized to a greater degree.

Additionally, as with other sectors of business, the prolonged economic recession has taken a toll on nonprofits, especially those that provide the vital human services that make up the fabric of our community’s social safety net. However, for nonprofits, an economic recession is more like a one-two punch. During tough economic times, most nonprofits realize an increased demand for their services. As people lose their jobs they turn to nonprofits for support such as food, shelter, medical services, and job training. Yet, at the very same time, individual donors who account for more than 75 percent of all charitable giving are facing shrinking wallets and uncertainty about the future. Similarly, the uncertain economic climate makes many corporations reluctant to give as generously as they did in better times. Collectively, this translates into a drop in charitable giving at the very moment when nonprofits need support the most.

During the last two years, San Diego nonprofits have addressed these economic challenges in strategic and creative ways including increased collaboration, leveraging resources, and organizational restructuring. In short, our local nonprofits have learned to work better, stronger, and smarter to ensure that their San Diego neighbors are cared for properly. At the same time our research shows that nonprofit staffs are being stretched beyond reasonable limits. One quarter of nonprofits we surveyed nationally reported having to lay off staff last year. Eighty one percent of those organizations continued to provide services at the same level by reassigning additional responsibilities to their remaining staff. For the coming year, 37 percent of nonprofits are anticipating a further decrease in staff. Adding to the pressure, unlike previous economic downturns, the great recession finds nonprofits reeling from the devolution of government. The prolonged budget crisis requires nonprofits to deliver critical human services traditionally provided in partnership with government now, with little or no financial support.

Issues such as quality education and healthcare, affordable housing and small business development, environment preservation, and the arts are important to every San Diegan and most often provided, championed by or supported by nonprofit organizations. For example, many public schools are assisted by nonprofit foundations that raise funds for programs that schools cannot otherwise afford to provide. Nonprofits need to find a stronger voice to ensure their organizations are recognized and valued for the contributions they make and that their concerns as a sector are heard and respected. The contributions nonprofits make to the economy need to be noted and touted – our local organizations employ more than 75,000 people and contribute approximately 6 percent of the Gross Regional Product. Additionally, the public needs to understand that nonprofit professionals are just that – knowledgeable leaders who are expert at delivering the goods and services that make our community so great.

The opportunities before us are manifold. Nonprofit leaders need to share what they know and work in partnership with business and government to address the issues that concern us all.

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Laura Deitrick | [email protected] | 619-260-2903

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