Leadership Network Survey: Cause for optimism despite economic downturn

Survey by Leadership Network and Church Executive shows cause for strong year in 2009.

Ronald E. Keener

The news is mixed among larger churches surveyed about the impact of tough economic times on their congregations. The 105 large churches surveyed by Leadership Network this summer said they were minimally or not at all affected (56 percent) by the downturn in the economy, while 41 percent gave a somewhat negative and 3 percent said very negative to the question.

Both attendance and financial offerings appeared to be mildly positive in the majority of the churches surveyed, with attendance up more than offerings in May and June when the survey was taken.

“Most of these churches were already growing, and so they are continuing their growth pattern despite today’s more challenging economic pressures,” says Leadership Network’s Warren Bird, director of research.

The survey of salary and economic outlooks was made of 105 churches with attendances of 1,400 to 10,000. It is not a scientific or random sample of larger churches, but rather a sampling of those who self-selected to participate in a 208-item online survey. The sample size was considerably larger than the survey taken in 2006. Church Executive was a participating partner for the survey in both years.

Most expect increased income

In terms of expected income this year, 74 percent of surveyed churches expect that income will increase in 2009, while 66 percent expect that their church will probably meet its budget this year and 28 percent said that they probably would not meet budget. Two years ago the latter group constituted 4 percent who would not meet budget.

There was an air of optimism among the respondents despite some challenges. When asked to name phrases that typified their feelings, the most selected ones were expecting growth in attendance, prayerful, encouraging, anticipation, optimism, excitement and positive.

At the same time, 74 percent of surveyed churches expect their income will increase next year, but that’s down from 96 percent two years ago. Nevertheless, 13 percent expect income to remain the same and only 12 percent predict a decrease. The latter data is the first time in the survey that any church has predicted a decrease.

An open-ended question asked what the church is doing to prepare its people for the potential of a significant national recession. Half of the churches responded and expressed such thoughts as staying on message, increasing financial counseling, doing more stewardship training, monitoring the church budget more carefully, decreasing our church debt, helping people get out of debt, and job coaching when people lose a job.

Four respondent groups defined

The high response rate from 30 states allowed the responses to be split into four groups: Attendance of 1,400 to 2,999, 3,000 to 4,999, 5,000 to 6,999 and 7,000 and more. The number of churches in each group was 62, 28, 9 and 6. Among respondents, the typical church offers five weekend services, more than the national norm of two for Protestant churches.

The survey showed that surveyed churches use 10 to 15 percent of their total budget, on average, for ministry beyond their own congregation. “Interestingly,” says Warren Bird, “as the church gets larger, the percent of the total budget used for ministry beyond the congregation does not change proportionately; instead it is all over the map.”

“Yet despite the variances, the responses do generally go against most stereotypes of larger churches, as a full 60 percent report more than 10 percent of their income going to ministry beyond their local church,” says Bird. “For 23 percent of churches, it’s more than 15 percent.”

The survey also produces data on staff costs, staffing ratios, numbers of direct reports, salaries, benefits, medical insurance, and pay increases, among other data.

Staffing ratios of staff to attendees was 1:45, or one staff member to every 45 attendees (calculated from an average number of 70 staff and an average attendance among the 105 churches of 3,178). In 2006 the ratio was 1:59.

Salaries for the senior pastor or the directional leader rose in two years $7,000 from an average of $132,000 to $139,000; the highest salary was $300,000, down from $364,000 two years ago. Executive pastors’ salaries also rose $7,000 in two years, from $90,000 to $97,000. with the highest at $167,000. Salary information for 32 other titles is also included.

Pay increases, among 72 percent of the churches, were reported at 3 percent or more, while some 15 percent of churches went as high as 5 percent. The responses to this question did not vary much with church size.

Medical most often given

Medical and dental insurance are the most-offered benefits to the majority of the church’s full-time staff at 97 percent and 82 percent respectively. Two years ago the dental number was 68 percent. Ninety-eight percent of the churches reported offering some benefits for retirement accounts, but the larger the church the less likely a church is to offer an employer match for retirement savings.

The health insurance plan is offered by 65 percent of the respondent churches, down from 83 percent two years ago. HMOs (24 percent) and POS (12 percent) follow.

Warren Bird notes that “the largest change in health insurance is the growth of Health Savings Accounts and High-Deductible Health Plans combined with Health Savings Accounts.”

And what major emphases are churches expecting in year 2009? Leading the way are a capital funds drive for new property or building — 30 percent, down from 44 percent in 2006 — followed by a special campaign to help the poor and needy (25 percent), and an appeal to plant new congregations (23 percent, the same number as two years ago).

Where will spending be done next year? Among seven categories, from top to bottom, came facilities, staff salaries, information technology, missions, communications for in-house publications and marketing, program-related spending, and at the bottom, continuing education for staff. The ranking is unchanged from two years ago.

By church size, the largest group (7,000 and higher attendance) increases were seen in missions, facilities and communications. Nevertheless, none of the 105 churches indicated a “significant decrease” in any of the seven categories named, and very few projected a “moderate decrease.”

“The survey,” says Bird, “gives selective insight in what’s ahead. If nothing else, it shows that the surveyed churches are going forward, growing and reaching out. They seem to reflect much hope for the months ahead.”

For a copy of the “2008 Leadership Network Salary and Economic Outlook Report,” including charts and graphs, go to Leadnet.org/salary.


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