By Scott McConnell
Some churches have already missed two typical weeks of gathering in-person for worship, based on their proximity to the spreading coronavirus in the U.S.
The question is, how long can churches survive financially in these troubled times? The answer depends on the cash individual churches had on hand and generosity in the days ahead.
Lifeway Research conducted a study of Protestant churches in 2016 that revealed that some churches are prepared to weather months of interrupted giving, but others have little margin for any pause in donations.
While there were three years of economic growth since this survey, we expect these numbers still reflect the cash reserves of churches overall. And the news is troubling.
Are churches prepared?
In total, 1 in 5 Protestant churches (19%) has 4 or fewer weeks of cash at any given time. This includes 2% of all churches who literally operate week-to-week. Another 4% of churches have 2 weeks or less of cash at any given time.
Cash reserves are not something most churches spend a lot of time discussing. Finance and stewardship teams at churches definitely discuss the balance in the church bank account, but planning for financial disasters takes intentionality especially in good times.
It is not that giving will completely stop during this time, but the current economic shock from COVID-19 is being felt in every sector.
First, churches will be impacted by the logistical hurdles of receiving donations when they are not physically meeting. Many churches have had online giving options for some time, but others are just now exploring options.
In 2018, 30% of Protestant churches offered online giving through their website.
Other churchgoers already have regular payments set up to their church through their bank, and mail is still being delivered so check writers can still mail their tithes.
What we don’t yet know is the full impact of not having the physical reminder to give expressed through offering plates being passed or walking past giving boxes that occur in a normal week at church.
Second, churches will be impacted by changes in the income of their attendees. Thankfully, some of the most faithful givers in the church are on fixed incomes. Most of these should not be impacted in the short run by the economic downturn.
However, hourly employees are already missing shifts and layoffs have begun. Some people may be quickly hired back when the virus subsides, but other companies may not be able to resume all operations again.
No matter what, individual income will take a hit in 2020.
Moving forward by following historic examples
These times will require the church to act again like the church did in the first century.
In Acts 2 it says, “Now all the believers were together and held all things in common. They sold their possessions and property and distributed the proceeds to all, as any had need.”
This can be true within a church. Those who have can give beyond what they normally do to help the church and other individuals.
This can also be true across churches. Some churches have many months of reserves and are in a position to be generous in their community and to assist other churches.
Fourteen percent of churches have between 5 and 8 weeks of cash. One in 6 (17%) has operating reserves to cover between nine and 15 weeks of no income.
Fifteen percent have between 16 and 25 weeks of reserves, while 12 percent have between 26 and 51 weeks. Twenty-three percent have a year or more.
Smaller churches often have more weeks of reserves than larger congregations.
Among small churches—those with fewer than 50 people—27% say they have a year of cash reserves. By contrast, 15% of larger churches—those with more than 250 people—have a year of reserves.
A recent study by Lifeway Research found about 1 in 5 churches were already struggling to make their budget prior to the COVID-19 outbreak. So it’s not surprising that some churches have few reserves.
It has been easy for American churchgoers to give out of their abundance. For the first time, the American church may need to follow the example of the widow Jesus commends in Luke 21 and actually give all we have.
SCOTT MCCONNELL (@smcconn) is the executive director of Lifeway Research.