Third Sector Trends in North East England

Analysis undertaken drawing data from the combined charities register and other sources has enabled estimates to be created of the number of organisations, employees, financial turnover and financial value of the sector in each Local Authority across the North East. 

By then setting that data against the size of the population in each Local Authority, we can see the variation in size and scale of the sector within the region. In the table below you can sort the data by column by clicking on the title. 

Across all indicators it’s clear that the sector is substantially more robust in Tyne and Wear, Northumberland and County Durham than in the Tees Valley Area. Moreover, if  Tees Valley is excluded, figures for the rest of the North East are broadly in line with the median for England and Wales. It is clear there is a need for renewed policy focus on investing in and strengthening Civil Society in the Tees Valley. 

There is also an interesting picture in the strength of the sector in Northumberland; this would require further analysis to assess if this is related to its relative affluence, its rurality and reliance on charities to provide reach and services across a more dispersed population, or for other reasons. There isn’t any clear anomaly suggesting a higher density of organisations in Newcastle as the regional centre (unlike London in the national figures) but this may be because relative cost benefits of spaces in other parts of the region means regional charities are not necessarily operating out of Newcastle. 

Working in partnership remains a strong part of the culture among charitable organisations in the North East; compared to other regions and the total figures for England and Wales, respondents in the North East were most likely to respond that they were working in partnership against all the different 'forms' of partnership working asked about in the study, and were over 40% more likely to be involved in some kind of formal partnership. 

You can sort the data in the table by clicking on the column header. 

This likely reflects the strength of the sector’s infrastructure and its value in facilitating and convening, as well as other noted dynamics of the sector in the region - that it has a larger proportion of larger organisations which employ staff and which have a strong emphasis on tackling critical social need.

Like the rest of England and Wales, the North East did see a substantial fall in partnership working during the Pandemic, when a lot of sector activity was suspended or refocused on very immediate work to alleviate the most critical frontline needs. It has similarly seen a lacklustre recovery since 2022, and figures are still down from the peak in 2019; nonetheless the picture is still one of the vast majority of organisations responding positively about having some form of partnership working. 

The charitable sector in the North East appears to have a more negative view of its relationships with the local public sector than in other regions and in comparison to the national data for England and Wales. You can sort the data in the table by clicking on the column header. 

Looking at this indicator in terms of change over time, the pattern broadly mirrors the national picture: organisations still feel valued, but feel less positively engaged than in recent years.

Whilst it is difficult from the data to provide any explanation for the less positive experiences of engagement with the public sector, it is clear that local and regional policy-makers need to commit to embracing the Civil Society Covenant, and to making this meaningful for local charities and community groups. 

Analysis of the data shows the North East has the highest proportion of organisations involved in bidding for or delivering public sector contracts of any region but, as with across England and Wales, it has fallen steeply in recent years.

The data suggests there is a good level of "tender-readiness" among organisations in the region; work undertaken by umbrella organisations and supported by funding from previous governments to develop skills and systems within charitable organisations to enable them to bid for and deliver contracts has left the sector in a strong position to deliver if it wants to. This means for current and future indicatives to involve Civil Society in delivering in communities, the ability is there if the conditions are right. 

The question here is for policymakers wanting to engage Civil Society, and for the Mayoral Strategic Authority and Local Authorities, in their commissioning and procurement practices, and in their policy-design of programmes they want to collaborate with the charitable sector to deliver. Understanding why organisations are opting out of the market and what practices need to be reviewed at local level to make involvement of charities a viable prospect is more important than further work to make organisations tender-ready. 

The sector in the North East is far more proactive in its engagement with policymakers than nationally, more likely to attend meetings, and say they campaign or lobby local systems and leaders to push for change; this proactive mindset may account for the slightly more negative view of the local public sector, as we have high expectations and strong ambition for our communities and the people we support. 

It’s notable however, that we are also more positive about trusting sector infrastructure to campaign on our behalf, and this again indicates the strength and value of our regional infrastructure.

Like the rest of the country, we are still ambivalent about whether devolution has had a positive impact; if anything, we are even more “yet to be convinced”, and a very high rate of respondents feel they are being asked to do more to help improve engagement with local people. It’s important in building trust that Civil Society feels the benefit of devolution and is properly resourced to facilitate engagement with local communities. 

The regions’ reliance on different income streams is continuing to shift; we can see again contracts becoming less important, and investment income and subscriptions having substantially reduced as a proportion of the funding mix. 

Whilst other forms of income continue to hold steady, there is no doubt that grants are not only the most important income source, but increasingly so. There is the potential this will continue to increase competition for funds and pressure on grant-makers in the region, and something both funders and delivery organisations should be sanguine about being prepared for. 

The earned income trajectory shows an interesting picture; both the proportion of organisations with no earned income, and the proportion earning the majority of their income have fallen, whilst those with some but not a majority of their income coming from some form of trading activity has increased.

This may be a reflection of the wider trend of organisations diversifying income streams to strengthen their sustainability.

The North East is clearly bucking the national trend, with support from business in all its forms holding steady over time and financial support actually increasing in recent years. This is a stark contrast to the national picture, which suggests support for business fell during the pandemic and has not recovered in the years since. 

The North East also has some of the highest levels of organisations reporting support from business is important to their organisation across all the different types of support.  This is a really positive reflection on the close connection our business community has with people and organisations supporting them. It provides a strong starting point for continued work to strengthen corporate philanthropy in all its forms in the region, supported by policy-makers and local organisations like Community Foundation North East. 

Compared to the national data for England and Wales, the North East experienced the same “bump” in grant-making practice in 2022 as grant-makers responded to the circumstances of the pandemic by adjusting their grantmaking practice. 

Charitable organisations in the North East are also most likely to report positive experiences of grant-making practice, with funders offering support around skills development and taking time to build a relationship with grantees. The region also has a higher rate of respondents in 2025 saying they received unrestricted funding. 

It is worth noting, however, in the North East there is also a higher than average rate of organisations saying they are being asked to be "innovative" by funders. This is something grant-makers in the region may want to reflect on as they consider best practice as funders. 

As a region, we appear to be finding recruitment and retention of staff harder than other parts of the country. The trend in the data suggests the perception among charitable organisations is that it is continuing to become more difficult, with responses to these questions being similar to those in the 2022 edition of the study. You can sort the data in the table by clicking on the column header. 

Off the back of the pandemic, we saw labour-force shortages creating problems in multiple industries, but as the employment market cools, with fewer vacancies and a creeping unemployment rate, we may find this begins to change, although we know there are challenges for our sector around being able to offer comparable terms and conditions, and finding people with the right experience and qualifications. The wider need to invest in the sector, and organisations to invest in themselves, are important considerations here. 

It’s clear that we might struggle with recruitment and retention, but we do perform better than other parts of the country when it comes to investing in our staff.

This analysis does not filter for organisations which don't employ staff, and we know there are a higher proportion of charitable organisations in the North East who are employers, which may account for some of this; however, it does also potentially reflect a strong culture of learning within the North East charitable sector, and the value of infrastructure support in the region which is well developed in comparison to other parts of the country. 

The North East is broadly experiencing the same challenges as other regions with recruiting and retaining volunteers; they feel this is becoming harder, and in line with England and Wales as a whole, 39% report regular volunteering has not bounced back since Covid.

You can sort the data in the table by clicking on the column header. 

Whilst we will not be able to confirm this trend until 2028, it is possible that we are seeing a confluence of economic and demographic factors reducing the volunteering pool and capacity across Civil Society. 

If this is the case, it is a potentially serious challenge for the sector to get to grips with in the coming years, particularly given that responses to the 2025 Third Sector Trends study show charitable organisations in the North East consider regular volunteers to be more critical than ever. 

Survey respondents in the North East also report increasing challenges in recruiting and retaining trustees, whilst changing patterns of characteristics of sector leaders mirror the national picture, with any real stories, trends or explanations difficult to infer from the data available. You can sort the data in the table above by clicking on the column header. 

Further positive reflections of our sector infrastructure and relationships with business are found in where we look for support around governance issues. Across all themes, North East organisations are more likely to access support from LIOs and the like, and also from the local private sector, and less likely to take a DIY approach. However, whilst the difference is not significant, we are less likely to access support from our local public sector, further confirming that for our region, it is this connection which is the weakest link. 

There is also a greater level of professionalism reflected in the fact that we are more likely to consider organisational development needs a priority than other regions, across all six themes covered in the survey; like the rest of the country “Income Generation” comes out top, highlighting further the tendency to hyper-focus on funding, but with a more sanguine view of the importance of other aspects of charity management; volunteers, trustee development, business planning, digital skills and AI. 

The sector as a whole is reasonably financially resilient. 

If we compare the charity sector in the North East to the statistics for England and Wales as a whole, the sector is marginally less secure; a slightly higher proportion of organisations state they have no reserves and slightly fewer have left their reserves untouched in the last year. 

It is likely this is linked to national data that shows organisations in deprived communities and those focused on tackling social need are more vulnerable; as the shape of the sector in the North East means those types of organisations are over-represented in the region. 

What is important here is that the trends within the region suggest there is not much change over time. Undoubtedly at any time, some organisations are thriving, some are struggling and some are holding steady. But as an overarching pattern there is not a shift to organisations becoming more precarious, if anything it is the opposite. It is easy to get drawn into the high profile stories of shock charity closures and believe the overall picture is one of doom and gloom - this data tells a very different story.

It's also noticeable from the data that the North East has a more entrepreneurial charitable sector than elsewhere: North East charities are among the most likely to use reserves to invest in new activities, and have become more willing to invest since 2022, albeit that we are still below pre-pandemic levels for this.  

The North East’s sector is buoyant and overall confident about the coming years: 

In line with other indicators, organisations in the North East are more positive about partnership working and relationships with business than the national average for England and Wales, however they are less optimistic about the future of statutory funding.

Survey responses from the North East show that social impact is a hugely important consideration in the work of charitable organisations. As expected, there are shifting patterns when comparing data from the 2025 study against those completed in 2019 and 2022; much of this shifting is a natural ebb-and-flow. However there appears to be an increased emphasis on addressing social isolation, which may have come into clearer focus as a result of the pandemic.

It's also useful to note that the proportion of organisations that believe they have an impact in improving people’s lives and outcomes across the above domains are substantially higher in the North East than for England and Wales as a whole. This further strengthens the picture that the charitable sector in the North East is heavily focused on addressing acute social need, and therefore continuing to support its work should be of great importance to grant-makers, philanthropists, policy-makers and local leaders alike.