Despite a more positive economic outlook for the United Kingdom, charities are still struggling to meet costs and provide for those that need them, a report from the Charities Aid Foundation (CAF) finds.

Based on responses from 621 charity leaders in April and May, the CAF Charity Resilience Index, how the cost-of-living crisis is affecting the sector (20 pages, PDF), found that only 38 percent of charities have confidence that they can meet current demand for their services, down from 54 percent in January. According to the survey, 81 percent of charities indicated that demand for their services had increased from a year ago, yet just over half had high levels of confidence in their ability to meet current overhead expenses (55 percent) and afford current staffing levels (53 percent). In addition, 60 percent said they were struggling to recruit or retain qualified candidates or volunteers (up from 43 percent in January), and 70 percent said the rising cost of living was affecting workforce morale (up from 53 percent).

According to the report, the respondents were slightly more confident in their ability to face these challenges than in January, with 36 percent having developed a plan to help them face the cost-of-living crisis (up from 31 percent). Charities with more than 200 employees were three times as likely as those with fewer than 20 employees to have developed such a plan (74 percent vs. 26 percent).

“Charities are still feeling stretched,” said CAF chief executive Neil Heslop. “They are worried about recruiting staff and struggling to meet demand for their help. Like the rest of us, they are having to adjust to inflation being higher—but they face the added challenge of people needing them more than ever, while donors’ incomes are squeezed. Britain can’t afford to have charities facing such uncertainty. We need a resilient, vibrant charities sector supported by a renewed culture of giving. That is why the UK needs for the government to draw up a strategy for philanthropy and charitable giving to mobilize effort across society and business.”

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