Charities no haven for laid-off bankers

LONDON (Reuters) - People dumped from finance jobs who hope to find employment in the voluntary sector may have to reconsider, because as Britain slips into recession, ailing charities are struggling to absorb the unemployed.

Ozlem Kus, a volunteer sales assistant, serves a customer at an Oxfam store in Dalston in east London November 28, 2008. Workers dumped from finance jobs who hope to find employment in the voluntary sector may have to reconsider, because as Britain slips into recession, ailing charities are struggling to absorb the unemployed. Picture taken November 28, 2008. REUTERS/Simon Newman

So far 180,000 financial professionals worldwide have lost their jobs as banks implode, prompting talented and financially astute people to seek work in other sectors.

Some of those job-hunters are turning to teaching maths and science at schools. But British charities are also seeing increased interest from the newly unemployed.

“In our shops people come and volunteer who have been made redundant. And in the head office too,” said Rosie Shannon, spokeswoman for charity Save the Children.

But unless people are prepared to serve in shops or fulfil administrative roles for nothing, they may struggle to find the unpaid posts to fill gaps in both their time and their resumes.

And as a tighter-fisted public cuts down on donations and corporate partnerships fall by the wayside, charities are also beginning to lay employees off and turn away volunteers.

International development charity VSO (Voluntary Service Overseas) said it received 2,572 enquiries for voluntary work between September and mid-November this year, more than double the 1,233 it received for the same period in 2007.

VSO said that unless applicants had management experience, it struggled to place them.

“We’ve had an increase in interest from people from that background but we haven’t been able to accept applications because we actually have very few jobs for financial professionals,” said VSO spokeswoman Catherine Raynor.

“It’s a shame,” she said. “People are keen to offer their time and commitment, so it’s never easy to say they’re not right. But it’s our commitment to our partners to get the best people for the jobs,” she added.

“If you’ve had management experience within your role ... rather than very specific financial skills, then we’d love to hear from you.”


The axe is heaviest on financial service jobs, but the slowdown is also hitting charities.

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“Charitable giving is...a luxury good in economic terms. I would expect charities to have a relatively hard time,” said Stephen Lea, an economic psychologist at the University of Exeter.

Three-quarters of charities believe income will remain stable or decrease in the next year, according to research from the Institute of Fundraising, the Charity Finance Directors’ Group and PricewaterhouseCoopers LLP.

The survey of 362 charities showed 32 percent putting capital projects on hold, while 71 percent expect either no growth or lower income from corporations in the coming 12 months.

Non-profit institutions serving households, the only available measure of charities in Britain, contributed about 3 percent of GDP in 2007, according to the Office for National Statistics.


Nearly one-third of British charities cut jobs between Sept 2007 and Sept 2008 and slightly more than half limited staff pay increases, according to a survey carried out by the Charities Aid Foundation and the Association of Chief Executives of the Voluntary Sector.

Cerebral palsy charity Scope said in October it was making five senior management posts redundant, from the executive management board to other back office departments.

Internationally focused Oxfam is preparing to cut 5-7 percent of its UK-based staff or between 35 and 45 positions in 2009/2010.

The downturn is also hitting sales in some charity shops.

“When the (economic crisis) news hit the papers five or six weeks ago things took a big tumble,” said Martin Penny, manager of an Oxfam shop on London’s Marylebone High Street.

“We’re 20 or 25 percent down (in sales) on this time last year, we should be building up for Christmas. It’s a bit gloomy,” he said, adding that he had seen an increase in graduate volunteers in recent weeks.


Scope is among charities that have been directly hit by this year’s hefty stock market losses.

It said in October it had lost 800,000 pounds of reserves on the stock market in a year.

Save the Children also lost money on equity investments.

“Every time the FTSE drops 100 points, Save the Children loses 175,000 pounds from the value of those investments,” chief executive Jasmine Whitbread said in written remarks for Reuters.

But experts say its focus on children may help Save the Children weather the storm.

The causes most likely to retain support are those focused on children, followed by international emergency relief and medical research, according to a survey by consultants the Management Centre.

“There are some kinds of expenditure that people conserve at all costs as they get poorer, and one of them is expenditure on children,” said Lea, the psychologist at Exeter.

Giles Pegram, director of fundraising at the National Society for the Prevention of Cruelty to Children, said children are “often more vulnerable to abuse and cruelty when there is an economic downturn because poverty increases family tensions”.

Charities focused on arts heritage and culture are likely to be the worst hit in the credit crisis, the survey showed.

Some animal welfare organisations are also feeling the pinch. Animal charity Blue Cross, which depends entirely on donations, has dropped its income forecast for the coming year by 10 percent because donations from legacies have fallen by half.

Animals in need of a new home after Christmas may also see the public turn a cold shoulder.

“Many animals are not being re-homed as quickly as in previous years, presumably because people are thinking twice before taking on another pet because of the cost implications,” said RSPCA spokeswoman Katy Geary.

Editing by Catherine Bosley and Sara Ledwith