As we finish out this first month of 2025, nonprofit leaders across the country like me are thinking about what lies ahead.
Changes in federal and local government administrations, new tax policies and ever-changing economic conditions will undoubtedly shape how organizations continue to serve communities. Yet nonprofits have played a pivotal role throughout history in addressing societal needs and serving as stabilizing forces during times of transition.
For example, the Peabody Education Fund was established in 1867 to integrate poor white and formerly enslaved individuals in the South after the Civil War. A decade later, United Way began as the Charity Organizations Society and its role was to coordinate resources to address community needs.
These organizations and countless other nonprofits consistently evolve to meet whatever current challenges and societal needs exist. Through world wars, social movements, economic downturns and public health crises, nonprofits fill gaps left by the government and private sector. In doing so, they offer hope and tangible support to their communities.
It is likely that this year will bring significant shifts in funding priorities and economic policies under the new administration. Adjustments to taxation and financial regulations will impact working families, businesses and nonprofit funding models.
ALICE (Asset Limited, Income Constrained, Employed) data tells us that shifts in policy and economics greatly affect those who are at or below the federal poverty line, as well as middle-class Americans who are working but living paycheck to paycheck and do not qualify for government assistance programs.
These ALICE households often choose daily essentials, like food and transportation to work or school, over other needs and could be easily devastated by a medical crisis or other unexpected expense.
We know that nonprofits must fill critical gaps in helping people with low-to-modest incomes meet basic needs when federal spending cuts decrease social programs. We also must remember that policy changes can bring new opportunities.
Discussions about access, equity and inclusion, particularly within health care, education and economic mobility, are expected to intensify in 2025, and we will see nonprofits continuing to serve as critical bridges between the public and private sectors.
Public-private partnerships are important for addressing immediate challenges while also fostering long-term solutions, and it is through these partnerships that nonprofits have proven their resilience and ingenuity to adapt. At the same time, nonprofits must continue to advocate for unrestricted funding and flexible resources to sustain programs and meet evolving community needs.
As we navigate changing landscapes, organizations will lean on evidence-based approaches to not only inform their strategies and programs but also to drive their impact. For example, data shows that programs that decrease absenteeism and build supportive learning environments improve students’ overall educational outcomes.
Meanwhile, economic mobility opportunities, like financial literacy resources and coaching, help families build stability. Food banks and community-based health organizations bridge gaps by providing people with additional ways to access nutritious food and related resources to keep their minds and bodies healthy.
We can never forget that it is the people, not just the funding, that sustains nonprofits. Regardless of religious beliefs or personal backgrounds, mission-focused organizations are guided by a moral compass to lift their neighbors in need.
As a woman of faith who grew up in the church, I have seen firsthand how far a dollar or an hour of volunteer time can go when multiplied by the collective will of a community. Contributions of time, treasure and talent allow us to provide meals to those who are hungry, give students chances to explore high-paying, high-demand career options, and equip families with financial knowledge to stretch every dollar.
So, as we move through 2025, it will be the people — dedicated individuals, volunteers, donors and partners — who drive the most meaningful change. Coming together across sectors will allow nonprofits to foster a more equitable, sustainable future for more people in a more efficient and effective way.
After all, nonprofits are not simply organizational entities. They are made up of neighbors and friends working tirelessly to ensure their communities not only survive but thrive.
If we continue to invest in one another to amplify the power of collective action, we can adapt, innovate and sustain the critical nonprofit work that makes the most lasting differences.
Let us keep these “rules of thumb” top of mind: If we want to go wide, go with the government. If we want to go deep, go with nonprofits and academic institutions. If we want to go fast, go with the private sector. And if we want to go far, we must go together.
Rosie Allen-Herring is president and CEO of United Way of the National Capital Area.