Washington, DC, June 08, 2020 (GLOBE NEWSWIRE) — Higher education fundraising is poised for a dramatic drop that will rival or exceed decreases seen during the Great Recession according to education firm EAB. The company today released findings from a new survey of 110 university fundraising professionals regarding current revenue projections.
More than 40 percent of institutions are projecting declines of at least 10 percent for fiscal year 2020, which for most schools ends on June 30. More than one in five expect fundraising revenue to drop by a minimum of 20 percent. Projections for fiscal year 2021 are even more pessimistic, with nearly 45 percent of institutions anticipating double-digit declines and a growing percentage of schools projecting a decline of at least 30 percent compared to 2019 totals. The problem is further compounded by fears of steep declines in endowment investment performance during what could be an extended bear market.
EAB’s survey findings and analysis were released today in a post to the company’s website titled “What 110 advancement leaders think lies ahead for university fundraising during COVID-19.”
“We’re nearly three months into the COVID-19 crisis and university fundraising leaders are only just beginning to see the impact that the economic slowdown is having on their ability to secure donations,” said EAB Senior Director, Jeff Martin. “EAB’s survey points to potentially devastating and long-lasting effects of this crisis on fundraising production.”
A separate EAB analysis of historical fundraising performance at nearly 1,100 institutions showed that during the Great Recession, many saw the most significant losses from their biggest donors. Likewise, EAB’s current analysis shows that most colleges and universities are bracing for big declines from their wealthiest supporters. Many senior advancement professionals today expect to see declines of anywhere from 20 percent to more than 30 percent in individual gifts of more than $1M.
“Large gifts are inherently volatile,” Martin added. “A single donor changing his or her mind about a big gift is enough to deal a crippling blow to overall fundraising production, especially as schools have come to rely on the top of the pyramid more.”
Travel restrictions and social-distancing protocols have also had an impact by eliminating campus visits, a tactic commonly used by fundraisers to inspire potential donors. Many advancement leaders expect visits to tick back up slightly in 2021, but that may be too late for those visits to impact FY2021 revenue.
“We all hope for quick action that can mitigate the health and economic impacts from the pandemic, but the effects on universities and their fundraising efforts will last for some time,” Martin predicts. “That said, there are steps advancement leaders can take now to make the best of a bad situation.”
A recent post from EAB offers recommendations to advancement leaders on ways to blunt the impact of a difficult giving environment. Those recommendations borrow from best practices that emerged during the Great Recession and include suggestions for reducing operating costs, demonstrating the tangible impact from donations, and incorporating more virtual interactions with prospective donors.
At EAB, our mission is to make education smarter and our communities stronger. We harness the collective power of more than 1,700 schools, colleges, and universities to uncover and apply proven practices and transformative insights. And since complex problems require multifaceted solutions, we work with each school differently to apply these insights through a customized blend of research, technology, and services. From kindergarten to college and beyond, EAB partners with education leaders, practitioners, and staffs to accelerate progress and drive results across three key areas: enrollment management, student success, and institutional operations and strategy.