Religious Organizations Facing Theological, Financial, and Political Pressures

By David P. King, PhD

This past week, Lake Institute released findings from our recent Covid-19 Congregational Study. We asked congregations to reflect on how they managed their resources in the midst of the compounding crisis they have faced since March. We also asked how they were looking to the future in terms of giving trends, budget planning, and reopening for in-person services. Religious organizations are entering what are often their busiest seasons with no clear direction for how to respond during these unprecedented times. Jewish synagogues, usually packed for the High Holy Days, created virtual or hybrid Rosh Hashanah services this weekend. Many Christian congregations are contemplating budget planning and pledge campaigns asking congregants to support the church for the next year amidst ongoing uncertainty. As all congregations are planning for their financial futures, they are asking themselves important questions about what comes next.

Our Lake Institute survey documented how congregations have responded in the midst of the pandemic since March. Overall, congregational giving declined by 4.4% on average from February through June 2020 compared to the same period in 2019. A plurality of congregations (41%) reported experiencing a decrease in giving, while more than a quarter (28%) said giving increased.

Sixty-five percent of congregations surveyed received federal Payroll Protection Program loans. Just 14% of all congregations reported having to make reductions, layoffs or furloughs of staff. Like most nonprofits, most sought first to control expenses by cutting administrative expenses. Yet, 30% of congregations raised funds to support other congregations and nonprofits in need. We found that those that had established mechanisms and cultures of online giving alongside consistent communication with their members, as well as an ongoing focus on their mission and values, fared better than those that did not.

When asked to look to the future, not a single congregation surveyed expected to increase its budget during the next year. The majority (52%) plan to maintain their current budgets, while 48% anticipate reductions, with most of those anticipating cuts in the 5% to 10% range.

Of course, holding budgets steady in the midst of these current times may be a great success. With everything leaders are managing, holding budgets flat probably makes sense as they are facing increasing anxiety, multiple unknowns, and perhaps paralysis in knowing how to respond. Most congregations are seeking to manage expenses similarly in the year ahead as they have managed in 2020. They are cutting administrative expenses and trying to maintain staff even while drawing down reserves and developing new fundraising appeals. How congregations respond to the current pandemic may be the question for their future. As all congregations must now respond to a new normal, how they adjust their economic and organizational models to these new contexts may shape the American religious landscape for many years to come.

One of the biggest questions congregations face at present is when and how to reopen. Just over half (53%) of congregations reported that they had already resumed in-person services or anticipated doing so by September 1. One-third of congregations indicated that they did not know when they would reopen. Yet, at some point this summer, it appeared that politics over public health reshaped the discourse of reopening, as congregations’ political orientations seem to have had a greater effect on plans for reopening than did public health or financial considerations. Nearly three-quarters (71%) of conservative congregations had reopened or planned to reopen by August for in-person religious services, compared to 20% of liberal congregations and 49% of moderate congregations.

With an increasingly polarized response to the pandemic, a presidential election, and now a Supreme Court appointment intermixed with economic realities, public health, and spiritual wellbeing of local communities, religious leaders are facing complex decisions. In our sample, as of July, 57% of congregations reported that the majority of their congregational members supported maintaining online-only religious services. Another 24% reported their congregations were “evenly split” on the issue.

In some ways, what we found in our survey is no surprise. Leading a religious organization in these current contexts is undeniably complex. For those congregations that continue to meet online, will “Zoom fatigue” affect participation and giving or will it allow for new opportunities to reset the organization’s mission and programs? As all congregations respond to a new normal, how will they meet new financial and institutional challenges in adjusting their economic and organizational models to new contexts? The answers are not clear; however, we find religious leaders to be resilient, innovative and up to the task of leading their congregations and communities through uncharted waters in matters of faith and finances. Cultural, social, and political issues add another layer to these questions. How congregational leaders mediate the theological, financial, and political pressures that they will continue to face in the days ahead will define the American religious landscape for the next decade.