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Hartford Seminary

American Congregations hurt by Recession

The 2008 recession extended a decade-long erosion of the financial health of American congregations, with just 14 percent saying in 2010 that their financial health is excellent.

Of those who characterize their financial health as declining between 2005 and 2010, a full 80 percent reported a negative impact from the recession.

And the recession affected just about every kind of congregation equally.

These are among the conclusions drawn from a major new Faith Communities Today 2010 survey of American congregations.

The Cooperative Congregational Studies Partnership (CCSP) conducted the FACT 2010 survey, and analyzed responses from 11,077 randomly sampled congregations of all faith traditions in the United States. The survey updates results from surveys taken in 2000, 2005, and 2008 and is the latest in CCSP?s series of trend-tracking national surveys of U.S. congregations.

David A. Roozen, Director of the Cooperative Congregational Studies Partnership and Professor of Religion and Society at Hartford Seminary, said that, ?Although the downward trend [in financial health] has been relatively constant, there is no doubt that the recession at least temporarily set back any hope of recovery.?

Still, he said, ?To the extent that there is good news in the FACT 2010 findings regarding the impact of the recession, it is that one in ten congregations reported that they had already begun to recover from an initial recession-driven dip in income.?

?The worst of the recession?s impact on American congregations may be over,? he said.

The FACT report, entitled ?Holy Toll: The Impact of the 2008 Recession on American Congregations,? examines the program, human and organizational toll of the recession.

Among the findings under the program toll:

The most frequently employed mechanism when congregations encounter financial distress is digging into savings and investments, followed closely by salary freezes or reductions and postponed capital projects.

A common fear is that mission and benevolence spending will be the first thing cut but this is not the case.

?The good news for advocates of congregational outreach,? Roozen said, ?is that FACT 2010 shows virtually no difference between congregations negatively impacted by the recession and congregations spared the recession?s financial toll in the likelihood of offering outreach services. Mission remains a priority even in times of financial distress.?

?The absence of recession impact on either outreach or member-oriented programming resonates with the observation of one commentator who noted that American congregations are ?putting off rather than pruning?,? Roozen said.

He also noted that while the program toll of the 2008 recession appears to have been minimal, the same cannot be said for the human toll.

Nine percent of congregations reported staff layoffs or furloughs because of the recession, and just over 25 percent reported salary freezes or reductions. Assuming an estimate of 350,000 congregations in the United States, employing an estimated 1.5 million staff, that equates to more than 500,000 people who lost their jobs or had their salaries reduced.

In addition, 41 percent of congregations reported that the recession had a major or moderate impact on unemployment among members. And half the congregations for which the recession had a major impact on the unemployment of their members saw a major decline in congregational income.

This stark impact led to an increase in requests for cash assistance, pastoral counseling, and emergency housing. Nearly half of all congregations experienced an increase in requests for cash assistance, underscoring the importance of American congregations as a social safety net.

?It may well be that the organizational toll of the recession on America?s congregations turns out to be the most significant in the long term,? Roozen said.

The negative impact of the recession on congregations that had declines in income is especially dramatic for worship attendance growth, spiritual vitality, and volunteers. It also led to increased levels of conflict.

The report asks:

Will the corrosive effects of lost capacity take on a life of their own that perpetuates a downward spiral even after the immediate economic impact of the recession passes? Are there things a congregation can do that might contribute to a recovery?

The most promising, if difficult, path to recovery appears to be to grow one?s way to recovery. Enhancing spiritual vitality is another possible contributor to recovery. Openness to change is also a key element.

While the 2008 recession impacted congregations, recessions do eventually pass, Roozen said. ?The longer term story,? he said, ?is the downward trend, at least a decade old, in the financial health of American congregations.?

He asks: ?Can American Congregations stem the now longstanding downward trend in financial health? Anyone who thinks the foreseeable future will be anything but challenging appears to have their head in the sand (or the clouds). But anyone who has begun writing about the death of the American congregation doesn?t understand or appreciate American church history.?

The report was written by Roozen, director of the Seminary?s Hartford Institute for Religion Research.

Links to view the report and related material are available at: www.faithcommunitiestoday.org.

Faith Communities Today surveys and publications are products of the Cooperative Congregational Studies Partnership, a collaborative, multifaith coalition of American faith communities affiliated with Hartford Seminary?s Hartford Institute for Religion Research. Researchers, consultants and program staff representing 39 denominations and faith groups contributed to the American Congregations survey.

FACT/CCSP strives to offer research-based resources for congregational development that are useful across faith traditions, believing that all communities of faith encounter common issues and benefit from one another?s experiences. It also informs the public about the contributions of congregations to American society and about the changes affecting and emanating from one of America?s major sources of voluntary association ? local congregations. For more information on CCSP, visit www.faithcommunitiestoday.org.

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