It has been five years since the world went into lockdown as a result of the coronavirus pandemic, and nonprofit organizations continue to face evolving challenges while adapting to a fundamentally changed landscape.
The Current State of Nonprofit Giving
The nonprofit sector has shown remarkable resilience in recent years. U.S. charitable giving reached a record $592.50 billion in 2024, representing 5.5% growth in current dollars compared to $557.2 billion in 2023. This growth signals a return to more stable fundraising patterns after the unprecedented giving spikes during the early pandemic years.
Individuals remained the largest donor segment in 2023, representing 67% ($374.4 billion) of all US giving, demonstrating that personal philanthropy continues to be the backbone of nonprofit funding.
The Ongoing Workforce Crisis
While giving has stabilized, nonprofit organizations continue to grapple with severe staffing challenges that have persisted well beyond the initial pandemic disruption.
Burnout Reaches Crisis Levels
Almost 95 percent of nonprofit leaders surveyed in 2024 cited burnout as a concern, showing this issue has actually intensified rather than improved over time. Nearly all leaders surveyed expressed some level of concern about burnout, with more than a third reporting that staff burnout has been a major issue over the past year.
Persistent Staffing Shortages
The staffing crisis has deepened significantly since the original post-pandemic period. In a 2023 survey conducted by the National Council of Nonprofits, nearly 75% of nonprofits reported persistent job vacancies — particularly in program and service delivery roles, where 74% reported vacancies — severely impacting the sector’s ability to serve communities.
Rising Turnover Rates
Turnover rates have increased from the earlier post-pandemic figures. The nonprofit turnover rate now clocks in at just over 21%, significantly higher than the 12% average across all sectors. 61% of those considering leaving their roles cite compensation as a key driver.
Root Causes: Beyond COVID-19
Compensation Challenges Continue
The average 2023 nonprofit salary was $96,126 — nearly 1% higher year over year in the United States, but this modest increase has not kept pace with inflation or competitive pressures from other sectors. Only 41% of nonprofits surveyed are able to pay all full-time staff a living wage, and only two-thirds offer health insurance.
Systemic Issues Persist
More than half (50.2%) of nonprofit leaders pointed to stress and burnout as major workforce issues, while one out of five respondents (20.6%) identified challenges caused by government grants and contracts as a major cause of nonprofit workforce shortages.
Key Resources:
- Nonprofit Finance Fund Survey: Living Wage & Benefits Data
- National Council Research on Systemic Workforce Issues
- Johnson Center: Nonprofit Workplace Wellness Crisis
The Evolution of Funding Approaches
Restricted vs. Unrestricted Giving in 2024-2025
The pandemic created a significant but temporary shift toward unrestricted funding. In 2020, 43% of COVID-related foundation funding was unrestricted—a dramatic increase from pre-pandemic levels when only 41% of grant recipients received any multi-year general operating grants at all, and these typically represented less than 25% of their total foundation funding.
However, recent data suggests this shift has been partially reversed. While foundations made commitments to provide more flexible funding following COVID-19 and racial equity movements, many have gradually returned to more traditional restricted giving patterns as the immediate crisis has subsided.
Current State of Unrestricted Giving:
- General operating support still accounts for approximately 20-25% of total grantmaking
- The conversation around overhead and indirect costs has permanently shifted, with more donors understanding operational needs
- Trust-based philanthropy approaches are gaining traction, emphasizing multi-year, unrestricted commitments
- Administrative burden of restricted funds continues to strain nonprofit resources
Key Resources:
- Candid’s 2024 Research on General Operating Support
- Trust-Based Philanthropy Multi-Year Funding Guide
- Council on Foundations Analysis on Unrestricted Funding
New Funding Trends
- Impact-focused giving: Donors increasingly want to see measurable outcomes and long-term sustainability plans
- Capacity building support: More funders are investing in organizational infrastructure and leadership development
- Multi-year commitments: Longer funding cycles are becoming more common as funders recognize the need for stability
Looking Forward: Strategies for Sustainability
Addressing the Workforce Crisis
Successful nonprofits are implementing comprehensive approaches to staff retention:
- Competitive compensation packages: Including benefits, professional development, and flexible work arrangements
- Mental health support: Offering counseling services, wellness programs, and reasonable workload expectations
- Career advancement pathways: Creating clear promotion tracks and leadership development opportunities
Diversifying Revenue Streams
Organizations are moving beyond traditional grant-seeking to include:
- Social enterprise ventures
- Fee-for-service programs
- Individual donor cultivation
- Corporate partnerships beyond simple sponsorships
Technology Integration
The post-pandemic digital transformation continues with:
- Advanced donor management systems
- Data analytics for program evaluation
- Hybrid service delivery models
- AI-assisted fundraising and communication
Key Takeaways for Nonprofit Leaders
- Workforce investment is critical: Organizations that prioritize staff well-being and competitive compensation are better positioned for long-term success
- Funding diversification remains essential: Relying solely on grants or individual donations creates vulnerability
- Operational transparency builds trust: Donors increasingly understand and support necessary overhead costs
- Technology adoption is not optional: Organizations that embrace digital tools for efficiency and impact measurement will thrive
- Community partnerships amplify impact: Collaboration reduces duplication and increases collective effectiveness
Transforming Nonprofits After COVID-19: The Path Forward
As we move deeper into the post-pandemic era, successful nonprofits are those that view the disruption as an opportunity for transformation rather than simply a crisis to survive. The sector’s resilience in maintaining record-high giving levels while addressing fundamental operational challenges demonstrates both the critical importance of nonprofit work and the dedication of those who support it.
The organizations that will thrive in 2025 and beyond are those investing in their people, embracing innovation, and maintaining unwavering focus on their mission while adapting their methods to meet evolving community needs.
FAMCare Additional Resources:
- The Hidden Crisis in Human Services: Broken Reporting
- Enterprise Capital for Nonprofits: Beyond Traditional Grants
- Blueprints for the Burned-Out: Reimagining Growth in Human Services
Originally Published in July 2023, we have conducted a major update in September 2025 to include new trends, features, and best practices!