Adjusting to the New Economic Normal: What’s Working and What Isn’t
In June 2011 we asked members of ECCU’s Ministry Advisory Panel (MAP)** if they agreed with Federal Reserve Board (FRB) Chairman Ben Bernanke’s assessment that the U.S. economy is recovering. 44% agreed and 56% disagreed with the chairman. We also asked panelists how their ministries are adjusting specific budget categories and what they’re doing to encourage faithful giving.
** The MAP is composed of ECCU member and non-member ministry staff and leaders representing evangelical Christian churches, businesses, schools, and other ministries. This report was produced by ECCU’s research department.
ARE MINISTRIES EXPERIENCING THE ECONOMIC RECOVERY?
FRB Chairman Ben Bernanke stated on April 27, 2011, that the U.S. economic recovery is proceeding at a moderate pace and overall conditions in the labor market are improving gradually. The chairman believes that this recovery will continue throughout the year.
We asked panelists if they agreed with the chairman and if they were directly experiencing the effects of the economic recovery.
Question: Do you agree with chairman Bernanke that the U.S. is experiencing an economic recovery?
The results were mixed, but the majority (56%) disagreed with the chairman:
Question: Is the economic recovery directly affecting your ministry?
Of the ministries that agreed with the chairman, 62% were directly experiencing the effects of the economic recovery:
HOW ARE MINISTRIES ADJUSTING THEIR BUDGETS?
Next, we asked ministries what actions they are taking on specific budget line items.
Question: How is your ministry adjusting the following budget categories?
- In all six of the budget categories surveyed, half or more of the respondents had no changes planned.
- The category with the greatest cumulative change (48%) was projects/programs with 27% increasing them and 21% reducing them.
- The category with the least cumulative change (23%) was benefits with 18% of ministries reducing and only 5% increasing them.
WHAT’S WORKING AND WHAT ISN’T TO ENCOURAGE GIVING?
Finally, we asked ministries what specific actions they’re taking to increase member/donor giving and for their experience with successful and unsuccessful giving initiatives.
Question: Is your ministry using (or planning to use) any of the following means of encouraging faithful and generous giving?
- 85% of ministries have or plan to implement electronic giving options.
- Nearly two thirds (58%) of ministries use or plan to use social media to encourage giving.
- The least popular methods to encourage giving were audio and video programs on stewardship, with only 26% of ministries stating they use or plan to use them.
We also asked panelists to share their successes at increasing giving. Here are some responses:
“Transparency is a major key and information from the pulpit.”
“We cut some ‘non-essential’ ministry activities, focused on the basics, and began to build cash reserves regardless of the fluctuations in giving. It has resulted in more financial commitment from our members.”
“Aggressively solicit bids on major vendors. Evaluate cost/benefit of bringing outsourced maintenance in house. Use volunteers more. Ask and you will be surprised at how much talent and enthusiasm volunteers bring.”
“In early 2010 we launched a 90-day Tithe Challenge. We challenged people who currently were not tithing to commit to tithing for 90 days. They signed an agreement, and if they were not ‘satisfied’ with God's provision, they could request a refund of their 90 days of tithing. 2011 published an annual report for the congregation which included financial and ministry successes.”
“Give the vision repeatedly… Promote eternal-based programs and solutions…”
“Increasing financial transparency and tightening the budget made a big difference. Setting monthly giving goals based on the monthly percentage of the budget we historically bring in each month has helped keep people's eye on the ball instead of being overwhelmed by the ongoing deficit that we run until the end of the year.”
“We have experienced that folks respond when they understand the need. Good communication is essential.”
“Our congregation is willing to give generously to specific causes (e.g., youth programs and mission trips) to help with the expenses, rather than it all being funded through the budget.”
“Our pastor preached a six-week series on the generous believer which was one of the best ever heard! We saw immediate results in our offerings, which have been maintained.”
“The congregation has increased their financial support because of belief in the mission of the church and their ability to see results of the ministries now in place. We have increased our communication of the components of the budget and report weekly the contributions against budget, with detail comparison quarterly.”
“Keeping expenses down has been the largest help in meeting the goals.”
“We are seeing a significant increase in giving through online means. We have seen a 5% decline in Sunday offerings, but this is being greatly offset by online giving options.”
“A new focus on endowment giving has been successful; donors seem to be connecting with a long-term investment in the ministry.”
“I began to communicate with first-time givers by writing them a personal thank-you letter and giving them some general observations about where their money goes. This brought confidence to them and their giving continued.”
“Our board and staff saw the serious need we were in and made this a matter of prayer and sharing with some of their supporters. The urgency of our need prompted some gifts, but God also prompted some who were simply looking for our kind of ministry.”
“Restructuring, layoffs, outsourcing”
But not everything works for everyone, so we also asked ministries if they’d like to share about their efforts that proved unsuccessful. Here is some of what they said:
“At the end of 2010 we adjusted our budgets to remove ministries that were requiring income but we were seeing little results from them.”
“Sermons on giving”
“We used an online giving program on our website, and I would recommend this to almost all nonprofits. However, our supporters tended to use more direct means, so the cost of this program eventually outweighed the benefit. Now the website link simply makes contact with the director.”
“We put a lot of effort into our annual fundraiser in May 2011, and although it was a great event and brought in new donors, the donations made that evening were not as much as at our event last year.”
“Doing nothing and hoping that people would ‘understand’ the need.”
“Monitoring cash flow more carefully became a problem, because most of the funds come in at the end of the year. Watching the deficit grow through the summer and early fall was detrimental and contributed to a general sense of panic, when historically we know that we will be fine by December. It has been better to have monthly giving goals and monitor our success against those goals with the idea that if we meet those, the end result will be good.”
“We have found that you need to be careful about how many different types of ‘giving opportunities’ you present to your congregation. People want to participate and give to worthwhile causes and they have a limited fund to draw on. So we have found our folks transferring funds from the tithe to other opportunities, either because they don't understand the difference between the tithe and special offerings, or they just want to be a part and do not have the extra funds to do it. So, I would suggest that before extra opportunities are made known, design a clear and easily understood communication strategy about these issues and evaluate the new opportunities extra carefully to make sure you understand all of the possible impacts.”
“Financial stewardship classes have not produced much in the way of increased giving.”
“We increased the number of newsletters but have found no significant increase in giving through this means. If anything, the numbers from this are down.”
“Giving campaigns are not having an overall positive affect; they seem to be reducing general giving as much as the campaigns are receiving.”
The uniqueness of each ministry means efforts that were wildly successful at one might fail miserably at another. However, certain principles seem consistent across ministries that are outperforming. Seek ways to implement or improve on these principles:
- Transparency—in the area of finances, budgeting, and ministry expenses
- Communication in all areas—frequent, concise, and clear communication about your ministry’s vision, its successes and its needs
- Prayer—personal and corporate
- Action—ministries that chose inaction suffered more than those that took deliberate and thoughtful action.
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