Charity leaders are feeling slightly more optimistic about economic conditions in the sector over the next year, according to the NCVO's latest Charity Forecast Survey.
The quarterly survey of NCVO members, carried out in November, showed that 77 per cent of 146 respondents believed economic conditions for the voluntary sector would be negative during the next 12 months, down from 88 per cent in February's survey.
Forty-two per cent of respondents expected their own organisation's financial situation to worsen, compared with 27 per cent who expected an improvement. In February, 50 per cent expected their own situation to get worse.
However, only 8 per cent of respondents said they planned to cut jobs in the next three months, down 11 percentage points on the February poll. Twenty-five per cent of respondents said they planned to increase the size of their workforce.
Stuart Etherington, chief executive of the NCVO, said: "With donations already much reduced and the pressure on public spending, the voluntary sector is bracing itself for further, deeper cuts. Our economy may be starting to show signs of recovery but the voluntary sector is going to lag behind as these cuts take their toll."
Jenny Willott, the Liberal Democrat spokeswoman on the third sector, said charities feared an incoming Conservative government next year would see squeezing public finances as its overriding priority.
"This would be a kick in the teeth to the very sector that David Cameron says he wants to rely on," she said. "There may well be ways to improve the efficiency and user-friendliness of charitable funding, but any savings should be reinvested into making the sector more robust and should not be an excuse for a Tory tax cut."