Friday, December 27, 2019

Environmental Analysis Essay - 1108 Words

Environmental Analysis Introduction This analysis will consist of the identification of the industry in which my organization operates. It is important to identify key macroeconomic variables and their direct effect on the industry. This analysis has two charts that identify the relationship between two main macroeconomic variables and the corresponding industry variables over the last five years. I will also identify operating challenges and opportunities for the industry my organization is involved in. I work for an organization specializing in offering foster care,†¦show more content†¦When inflation occurs government spending and budgets are cut. For the most part, the social service industry is one of the areas directly affected by these fluctuations. There is less money available to sustain these programs and therefore nonprofit organizations have to decrease the services available. High interest rates also affect the money contributed to the organization. Borrowers are less inclined to pursue loans when interest rates are higher, whether the money goes for business or personal reasons. Sometimes, nonprofit organizations will contract with outside agencies for services; higher interest rates mean those agencies have less of a money supply, affecting the amount of business between the two entities. Tied into the above mentioned variable is also unemployment. There are two ways in which the agency is affected by unemployment. When there is less money available for the or ganization, there is less money to hire new personnel, which directly affects the turnover rate within the industry. The social service field has a high level of turnover; unfortunately, the paychecks do not match the amount of work and responsibility involved in this line of work. When the agency doesn’t have enough funding, it adds responsibilities to the job descriptions of the current employees. 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