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The Influence of COVID-19 on the Charitable and Non-profit Sector

The free market is an amazing force that capitalizes on innovation to find efficient ways of solving problems. This monetary incentive has led to not one,  two, or three, but four industrial revolutions over the last 200 years, with each one dramatically transforming the capacities of science and technology to provide value to our lives. On its own, this system still lacks some essential services that are relied on in our communities. Thankfully, there are organizations to provide these services which operate through charitable missions with no profitability. 

What are Charities and non-profits and why are they important? 

Charities and non-profits include small community service organizations as well as large hospitals, universities and other educational organizations. All charities are non-profits, but not all non-profits are charities, and this can be differentiated by how they report to the government, and their ability to give tax receipts for donations. 

Everybody will interact with these organizations at some time in their life, and they probably affect your current day-to-day way more than you realize.  Everything from sports organizations, education systems, various forms of healthcare, and scientific research has the potential to be linked with a charity. Additionally, employment by charities or nonprofits accounts for a higher portion of the economic force than is commonly appreciated. 

Throughout the pandemic, we’ve observed an increase in demand for charity services, with regards to how they can help people with their challenges. At the same time, charities also require more support than ever, and will have to adapt in many different ways to continue their work and contribution to our communities. 

The Digital Evolution of Non-Profit and Charities

As a result of COVID-19 restrictions, the landscape for charities and philanthropies has changed dramatically over the last year. On one hand, there is substantially more need for charitable services. Whether this is food bank services or English as a Second Language training services, the economic volatility of the pandemic has brought many more people to a position where they could benefit from the work done by charities in some way. At the same time as this rise in demand however, there has been a dramatic drop in the revenue that many charities rely on. The shutdown of entire sectors of the economy has led to the supply of donations drying up, but also with canceled events, a reduction in their capacity to fundraise. So basically, do more with less. 

One way that charities have been responding to this conundrum is to embrace technology to simultaneously expand their reach while also lowering some overhead costs. While many of the services that charities offer have moved digital out of necessity, this has presented the opportunity to connect with entirely new communities. Suddenly every non-profit has the potential to have global reach or to find the very nice community they are looking to serve. In addition to the ability to better execute on their missions, the digitization of the non-profit sector also opens up global fundraising opportunities, with Patreon being a great example in the education space. Of course, this does mean that technology is going to be a huge component of non-profit work in the future, consistent with trends in other sectors as well. Eventually the pandemic will fade (fingers crossed), and non-profits can continue to host in-person events in their local communities. However, the reach of their digital operations during the pandemic will endure, giving them the best of both worlds. Thinking globally, but acting locally will soon be within the capacity of most of the non-profit sector. 

Engaging with the cause 

So the mission of non-profits inspire you and their new digital format is alluring. How can you get involved? Here are 3 quick ways:

  1. Engage on Social Media. When a non-profit organization posts something on social media, they are trying to get the word out about their message. Liking, sharing, and engaging in discussion in the comments section is one low-cost way to support their cause by boosting their algorithm performance. Let’s see if we can’t make the next local fundraiser hashtag go viral?

  2. Donate. As we mentioned at the top, non-profits are having a rough time financially right now. While not everyone has much to give, every little bit can help out. Much of the current funding landscape is based on matched grants, so your $5 donation could be matched by a benefactor to raise $10. Plus you get tax benefits in addition to that warm fuzzy feeling of doing the right thing. 

  3. Learn and Volunteer. If you are looking to cultivate some tech skills, which are a core component of the future of work, there is no better place to do it than the non-profit sector. Since many won’t have the budget to for hire new tech people their existing staff will be looking for collaborators to make digital philanthropy a reality. Working with a non-profit is a great way to get that “2 years experience required” for entry level jobs and grow your professional skillet while supporting a great cause. 

If you enjoyed learning about how non-profits are re-defining themselves through disruptive technology, check out Episode 7 of The Science of Work; What does the future hold for charities and philanthropy?


References

  1. Melnyk, L. H., Kubatko, O. V., Dehtyarova, I. B., Dehtiarova, I. B., Matsenko, O. M., & Rozhko, O. D. (2019). The effect of industrial revolutions on the transformation of social and economic systems.

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