Wednesday, January 16

Red Cross rocked by staff cuts

The New York Times reported today that the American Red Cross is facing a $200 million operating deficit as a result of short fundraising and is preparing to cut as much as one-third of its headquarters staff.

Up to 1,000 employees are said to be on the chopping block - including about 60 members of the organization’s national fund-raising staff who have been told they should start looking for new jobs. My sources tell me that department heads have already begun talking to staff, although I haven't heard gossip yet about severance packages.

Suzy C. DeFrancis, the Red Cross’s chief public affairs officer, declined to discuss fund-raising problems specifically with Times reporter Stephanie Strom, other than to say that the organization had not raised enough to cover costs. “There are probably a lot of explanations for this deficit,” she said.

Take your pick. Is this the result of the leadership scandal caused by Mark Everson's departure, the lack of any significant natural diasters in 2007, or the first wave of RIFs that "a fundraiser" has been warning against for the past two weeks.

No matter which cause you want to blame... I'm willing to bet that this is not the first shoe to drop at the Red Cross or at other nonprofits facing similar pressure.

7 comments:

red cross-eyed said...

Red Cross seems to be in a "disaster response" mode 100% of the time. They have never successfully developed a cooperative fundraising strategy with their chapter network and continue to struggle with a never ending battle between the role of management and the board.

At this point I'm not sure there is much more left to "get wrong".

Anonymous said...

I can't even bear to come to this blog any longer.

The cup is not half empty. If there's "competition" for fundraising dollars then that's good for all stakeholders.

Bring it on.

jfundraiser said...

This seems to be the blog post of the day. The problem is not the economic environment that is the cause in this case, it is the organization that seems to bring this on themselves. Let's not use this as a self-fulfilling prophecy, please.

For another very wise perspective on this visit Creating the Future at http://hildygottlieb.com/2008/01/16/red-cross-again-yes-again/.

Mary said...

sad day. if 60 fundraisers could lose their jobs - it will take them evening longer to recover!

Tom Durso | The 501(c) Files said...

The Red Cross certainly needs to do a better job educating people about what they do between disasters.

Let's also remember, though, that nonprofits are not immune to economic conditions. Corporate America has been pink-slipping quite a bit lately, too, and as today's papers are reporting, there's some pretty intense worrying that a recession is on the way.

just askin said...

Any word on severance packages?

Anonymous said...

The Red Cross would benefit from a more sustainable ongoing fundraising focus