Charity sector jobs: navigating the economic landscape part 1

In the current global climate, characterised by ongoing challenges such as the aftermath of the pandemic and escalating living expenses, every sector faces unique hurdles. Recruitment has become a significant challenge, impacting businesses and organisations of all sizes. However, the charity sector, particularly recruitment, has faced various acute difficulties in attracting and retaining talent. 

Although the sector itself is recovering, the uncertainty has left non-profit organisations searching for strategies to navigate changing external factors. 

This two-part guide will examine the recruitment landscape within the charity sector to identify specific obstacles to attracting top talent during economic uncertainty and provide you with tools to navigate this. 

In part 1 of this guide, we will explore how the current global economic uncertainty is affecting charity recruitment operations, including:

Impact of economic uncertainty on charity recruitment 

Historically, charity recruitment was relatively straightforward, drawing individuals to jobs in the sector with shared values for specific causes. By 2024, however, recruitment had become more intricate and presented numerous challenges. 90% of charities have reported that the pandemic negatively impacted them, and the ongoing impact of the cost-of-living crisis has caused long-term issues for the sector overall. 

During this crisis, there's been a significant increase in staff recruitment and retention difficulties, with many pointing to salary increases as a major reason for changing jobs. One in three workers sees a higher salary as the main motivator for switching roles.

Unlike for-profit businesses, charities operate on tight budgets and rely heavily on funding coming from donations, grants etc. Economic fluctuations have the potential to disrupt the sector’s ability to attract and retain staff.

Your charity needs to adopt strategic and flexible recruitment approaches to tackle these challenges effectively. This will help you navigate economic ups and downs with resilience, ensuring you can continue your vital work. 

Now, let's explore how these funding issues can directly affect charity recruitment efforts:

• Attracting Top Talent: Limited resources often mean that charities struggle to offer competitive salaries and benefits, making it challenging to recruit, train or retain the best candidates. 
• Resource Challenges: Fluctuating funding creates resource constraints, making it hard for charities to invest in recruitment efforts such as advertising and staff development. This lack of resources makes it difficult to reach potential candidates effectively.
• Uncertainty: Funding's unpredictable nature creates an atmosphere of instability and uncertainty within charitable organisations. Concerns about financial sustainability often discourage potential employees from considering roles in the sector, as they prefer more stable job opportunities elsewhere.
• Impact on Services: Reduced funding can lead to cost-cutting measures like redundancies, directly affecting program delivery. This strain on existing staff members may discourage potential recruits, who might see the workload as unsustainable or view the organisation as financially risky. This has the potential to lead to more staffing issues. 

Funding fluctuations create significant obstacles to charity recruitment, limiting resources, destabilising operations, and making it difficult to offer competitive compensation. It is important to recognise this impact and consider the offerings and other benefits your organisation can provide potential candidates.
 

Increased amounts of industry competition for talent 

In challenging times, like economic downturns, charities face difficulties attracting and retaining talented individuals because other industries offer better compensation and stability. Charities often lack the financial means to match the salaries offered by private companies, making it challenging to recruit skilled professionals.

The number of applicants for charity roles has decreased with increased competition from other sectors. Many people prioritise stability and higher pay, especially during uncertain economic times. This presents a significant hurdle for charities, particularly when they require specific skills for their mission-driven work.

Without stable funding, the attraction of better-paying positions in alternative industries reduces the pool of talent accessible to charities, impeding their capacity to accomplish their vital missions.

The ongoing cost-of-living crisis has caused approximately 26% of the UK workforce to seek careers that offer more benefits, intensifying talent competition across industries and adding to the challenges faced by the charity sector in attracting and retaining qualified personnel.

The predominant focus on short-term needs 

The economic crisis has exacerbated challenges in retaining staff, providing training, and recruiting new talent in the charity sector, impacting the sector's reputation. Staff burnout is widespread, with 24% of charities citing it as a retention issue, rising to 34% for larger organisations.

During economic instability, short-term needs overshadow long-term planning, creating hurdles in recruitment. Economic downturns lead individuals to prioritise stability over risk, resulting in fewer candidates for charity sector jobs. Budget constraints worsen recruitment challenges, limiting competitive salary offers and hiring resources.

It's crucial for the entire sector, to prepare for future turbulence proactively. While economic challenges have typically been sporadic or gradual, the past five years have shown no signs of relenting. 

Increasing demand for services 

With four-fifths (81%) of charities experiencing a surge in demand compared to a year ago, existing resources are stretched thin, making recruitment and retention even more difficult. This presents several key challenges:

• Increased demand strains resources, requiring charities to do more with less.
• Limited capacity for growth impedes the expansion of teams to meet rising demand.
• Talent competition intensifies as job seekers prioritise stability and higher salaries.
• Charities struggle to attract and retain skilled professionals amidst heightened competition from other sectors.

According to the Charities Aid Foundation, three in five (60%) charities struggle to recruit or retain suitably qualified candidates or volunteers, marking a significant increase from two-fifths (43%) in a previous survey. As more turn to charities for essential support during economic hardships, the strain on existing staff leads to burnout and decreased morale. 

However, the sector's ability to recruit and retain talent is affected by the perception of instability and lower salaries compared to other industries, exacerbating recruitment challenges. Despite charities' critical role in times of crisis, the sector must navigate these obstacles to fulfil its mission and effectively support those in need.

Final reflections: impact of wider issues on charity sector jobs

As we conclude our discussion on navigating economic challenges in charity recruitment, it’s evident that the road ahead is not without obstacles. The fluctuating nature of the economy, funding and the increasing competition for talent pose significant hurdles. It’s essential to remember that challenges often bring opportunities for growth and innovation. 

By viewing these hurdles as opportunities to evolve and improve, charities can emerge stronger and more resilient. With determination and a forward-thinking approach, the charity sector can continue its vital work in serving communities and positively impacting the world.

By recognising these challenges and implementing strategic solutions, the sector and non-profit organisations within it will likely be more stable. Read on to part 2 of our navigating the economic landscape guide to discover our top strategies to stay resilient and ensure the security of charity recruitment during changing and unpredictable external factors. 

Helping to ensure a consistent non-profit talent pipeline 

At TPP, we are experts in charity recruitment, which means that we understand the current external and internal factors impacting charity sector jobs. From initial consultations to securing successful appointments, we're committed to ensuring a smooth and efficient experience at every stage, including providing you with a committed and trusted talent pipeline.

Contact us today to discover how we can help you.