Most charities (54%) have vacancies – causing some to limit their operations, according to a study published today.
The study, based on a sample of 489 registered charities, found that among those with hard-to-fill vacancies 46% have had to pause some operations.
One in five are struggling to meet quality standards and almost a third are unable to meet contractual or project objectives, found Pro Bono Economics (PBE) and Nottingham Trent University’s (NTU) National VCSE Data and Insights Observatory.
The study shows close to half of charities, 46%, do not expect to meet demand over the next three months.
Most charities (53%) have increased salaries while a quarter are concerned about staff burnout, it says.
‘The charity sector is facing a severe recruitment crisis’
Daniel King, director of the National VCSE Data and Insights Observatory, said: “The charity sector is facing a severe recruitment crisis, leading to staff burnout and serious gaps in service provision at a time of soaring demand.”
He added: “This recruitment crisis, coupled with the ongoing cost of living pressures, poses a considerable challenge to the sector's financial resilience.”
Recruitment is one of the top three concerns for large charities – with over four in 10 saying it is one of their biggest issues as they attempt to meet demand.
In response to these workforce challenges, more than half, 53%, of charities have hiked salaries and one in five, 22%, have increased spending on recruitment.
It found that employees at more than half of charities, 52%, that are experiencing recruitment difficulties were working more hours as a result, while 70% of these charities said the workload of their staff had increased due to the recruitment challenges.
In total, one in four, 24%, of charities overall cited staff burnout as a cause of retention problems and this rose to over one in three, 34%, for large charities.
The survey found that 55% of those charities struggling with recruitment cited the cause to be a lack of suitably skilled applicants, while just under half, 47%, said there was a lack of people interested in the type of work required.
The report adds: “To make things worse, the long-term downward trend in volunteering participation has continued. Volunteering rates have fallen to record lows, as the sharp decline in volunteering witnessed during the pandemic is proving difficult to reverse.”
Recent research by PBE for the Law Family Commission on Civil Society found that charity staff in the UK are paid 7% less per hour on average than workers in other sectors.
Charities navigating ‘perilous’ financial climate
The study reads that the sector has been trying to address rapidly growing levels of need, while simultaneously attempting to “navigate an increasingly perilous financial landscape”.
It also shows 51% of charities are having to resort to using their reserves to meet operating costs.
With inflation and energy prices squeezing the most vulnerable households, the survey found close to eight in 10 charities have experienced an increase in demand over the last three months.
At the same time, more than three-quarters of charities said income is one of their biggest concerns and a similar proportion said rising costs were causing financial deterioration.
“But as the economic outlook in early 2023 begins to show gradual signs of improvement, so too has the outlook brightened for some within the sector,” notes the report.
“The proportion of charities reporting high levels of uncertainty has fallen slightly, while a growing minority of organisations are becoming more optimistic about their short-term prospects in a range of areas, from recruitment to finances.”
The survey was undertaken between 6 and 20 February 2023, and is the second in a quarterly barometer series.
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