What does 2023 hold for the UK charity sector?

It is no secret that the future looks uncertain for many charities as we head into 2023, with many donors fearing they may be unable to keep up with regular donations and the cost-of-living crisis continuing to have an effect on the public’s purse strings. Charities are increasingly having to balance the rising demand for their services with limited resources to deliver them, not to mention the challenges of marketing to an increasingly stretched donor base. 

Sadly, the UK charity sector is already feeling the pinch. Only two in five UK charities say they feel optimistic about the next 12 months, according to ​a new report from Salesforce.  

In fact, of the seven countries surveyed in the fifth edition of the Nonprofits Trends Report, the UK was the least optimistic, with only 48% feeling optimistic or highly optimistic about the future of their own organisation. By contrast, in the United States, 63% felt optimistic about their organisation’s future, and 56% felt positive about the sector’s future as a whole.  

Is digital driving impact? 

Interestingly, the report found that the UK also has the lowest percentage of organisations with high digital maturity. While the appetite for digital is relatively strong – with 37% of charities in the UK believing digital transformation is a “must-have” – only 9% consider themselves digitally mature. 

Globally, nearly three-quarters of organisations say digital transformation is a must-have. Charities that say technology has already helped them become more efficient are also twice as likely to call digital transformation essential.  

However, the report suggests that some charities in the UK have been unable to experience these benefits due to certain barriers, the biggest of which is a lack of budget or resources and higher priorities elsewhere. 

That charities might not be prioritising digital at the moment is perhaps unsurprising, given that charities are currently dealing with a rise in demand for services amid the cost-of-living crisis.  

But Salesforce’s research also shows that charities in the UK understand how technology can help, saying they are investing in digital transformation to be more cost-efficient and to improve data management and optimisation.  

Are UK charity workers happy? 

More than half of UK charities say they will prioritise fundraising and staff retention over the next 12 months. This is particularly encouraging given that the UK also has the lowest percentage of highly energising or positive workplace cultures among the countries surveyed. They were also found to have the highest percentage of challenging or toxic cultures, cited by 34% of respondents.  

These statistics tell us there is work to be done to enrich the working lives of those in the sector and drive up retention rates. Retaining staff was highlighted as the second biggest challenge for charities globally, second only to raising awareness for their cause.  

Despite lower levels of optimism in the UK charity sector, there are reasons for hope. Across the seven countries surveyed, 84% of charities either met or exceeded their mission goals, while three quarters did the same with their fundraising goals. Fundraising, staff retention, and employee wellbeing were all cited as areas of higher priority for organisations in the coming year.