Jan 25, 2010

From the Archives

The Economy’s Impact on Churches (Part 2 of 3): How Churches Have Adapted

To view Part 1 of this series, click here

To view Part 3 of this series, click here

After enduring some of the worst economic conditions in modern history, many businesses, families and other charitable organizations are coming out of panic mode and adapting to the “new normal.” A Barna Group study with 1,114 pastors and church executives, conducted in the fourth quarter of 2009, explored how congregations and churches are coping with the economic downturn.

This is the second report in a multi-part Barna Update series. Other features in the series can be accessed at the following links:

Part 1 | Churches are Down 7% in 2009 (January 11, 2010)
Part 2 | How Churches Have Adapted (appears below)
Part 3 | Donors Reduce Giving(February 8, 2010)

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Adjusting to Decline
Most Protestant churches reported that the economy negatively affected their financial resources over the last year, resulting in an average decline of 7% across all such congregations. The Barna study shows there have been three major ways that churches have attempted to weather the downturn:
  • Reducing spending – Roughly one out of every five churches (21%) have cut their spending to compensate for diminished revenue.   In addition to budget reductions, pastors indicated that they were watching spending, conserving more, shopping for better deals, eliminating non-essentials, freezing portions of the budget, re-evaluating vendors. Each of these types of slices to spending was mentioned by 2% to 3% of pastors.
  • Cutting staffing and missions – A second type of reduction that churches made related to people, primarily staff members but also including missionary partners. In all, about one out of every six churches (18%) indicated that they had to eliminate positions, reduce salaries, rely on more volunteer time, and cut hours from full-time to part-time. Also, nearly one in every 25 churches said they had reduced their giving to missions or missionaries.
  • Reducing facility budgets – One of the least commonly reported adaptations was to related to church buildings and facilities (3%). These types of alterations included scaling back a building plan, eliminating a planned project altogether, delaying construction, making better use of existing facilities, delaying upgrades of equipment, and deferring maintenance and repairs.

Nearly half of church leaders (45%) said they had not made any changes to their ministry as a result of the economic problems of the last year.

The study discovered that the types of churches most likely to reduce spending included Boomer-led congregations and large churches (churches of more than 250 adults and budgets in excess of $500,000). The least likely churches to reduce spending were smaller churches, congregations located in the West, and churches led by older pastors (age 64-plus). Staff cuts were also most common among large churches. Churches located in the West as well as congregations associated with traditionally charismatic denominations were less likely than average to cut spending but were more likely to have resorted to eliminating staff positions.

Programs and Proactive Planning

For the most part, church leaders seem to have been in a hunker-down mode, attempting to get through the tough economy while avoiding drastic cuts to programs. Only a small minority of churches said the economy had caused them to cut back ministry services and programs. For instance, just 16% of churches indicated that the down economy had caused their church to offer fewer camps and conferences. The vast majority of congregations reportedly managed to keep their 2009 camp and conference programming on par with the previous year.

The research pointed to mixed results regarding the proactive engagement of churches in trying to address the economic crisis. On the one hand, a Barna study among churchgoers that was conducted when the economy began its steep decline showed that large proportions of church-going adults said their congregation was offering special talks about the financial situation, providing financial counseling, offering prayer support for those struggling financially, and increasing the amount of material assistance available to congregants.

However, in the current study, when pastors were asked to identify the changes they had made as a result of the economic downturn only about one out of every eight church leaders (13%) identified what might be described as activities that proactively position the church as a valuable resource to churchgoers and to those in the community. The  elements rarely mentioned by pastors included providing more financial assistance to the community, hosting support groups and classes for those with have lost jobs and who have experienced money problems, increasing the amount of prayer, teaching people how to handle money problems, and intentionally communicating how the church was dealing with its own budget shortfalls.

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Strengthen your message, train your team and grow your church with cultural insights and practical resources, all in one place.

Perspective on the Findings

David Kinnaman, president of the Barna Group, commented on the findings. “In the past year, most churches have been satisfied to tie down loose financial ends and keep costs under control. That has been no small feat for most organizations, let alone donor-driven congregations. Yet, the surprise is how few churches seem to have clearly and intentionally developed a proactive response to the downturn. Perhaps they have been so busy keeping the programs running that they have failed to see the significant opportunities as well as unique challenges represented in the new economic reality.

“For instance, many churches understandably have put off purchasing new equipment and technology,” Kinnaman pointed out. “Yet less than one-half of one percent of the churches we interviewed said they upgraded their use of technology in order to help cut down on costs or to maximize communication and reach. Some churches were naturally deferring building projects and facility-related expenditures, but virtually none of the leaders we interviewed said they were rethinking whether the future of congregational ministry required or could even sustain their current campus, much less planned facility expansions. And while some churches have offered resources, training and assistance specifically in response to the economic crisis, it is surprising that so few pastors had made strategic shifts to become a significant and vital resource to their congregants and to the broader community. Like so many others, church leaders have been focused on surviving; now is the time, though, to calibrate ministries and strategies to the opportunities brought by the new economy.”

About the Research

This report is based upon annual tracking surveys conducted via telephone by the Barna Group among representative random sample of Protestant churches (known as the PastorPollSM and ChurchPollSM). At each of the churches contacted, the senior pastor or executive pastor was interviewed. The interviews were conducted in October through December, 2009. The sample was balanced according to the denominational distribution of Protestant churches in the 48 continental states. The sample size for the survey was 1,114 pastors and church leaders, using a mixed mode data collection of telephone and online interviews. The range of sampling error associated with the sample of pastors is between ±1.4 and ±3.2 percentage points at the 95% confidence level. These allowances do not include other types of error (known as non-sampling error) that can occur in surveys, such as errors arising from question wording, question sequencing, and the inaccurate recording of responses.

To view Part 1 of this series, click here

To view Part 3 of this series, click here

About Barna

Since 1984, Barna Group has conducted more than two million interviews over the course of thousands of studies and has become a go-to source for insights about faith, culture, leadership, vocation and generations. Barna is a private, non-partisan, for-profit organization.

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