A report launched by the TUC found that a number of LGBT groups are having to cut staff and reduce their services, as the result of a drop in funding.
A survey of 96 voluntary and community service LGBT organisations found that 27% said they have had to make service cuts following funding drops, while 16% faced cuts but managed to keep services going.
It also found that a higher proportion of work in the LGBT sector was part time, leading to lower quality of employment.
TUC General Secretary Frances O’Grady said: “LGBT services were already coping on a shoestring, receiving just 4p in every £100 of voluntary sector income. Some LGBT service providers now say they’re barely ‘staying alive’ and only a minority are optimistic that their future situation will improve.
“We are on the brink of a crisis with the financial reserves of many services running down and government plans for further rounds of austerity in danger of pushing them over the edge.
“While Britain has made great strides for the LGBT community in some areas, such as the right to equal marriage, we can’t afford to be complacent.
“Prejudice has not yet been eradicated and it helps perpetuate problems like higher rates of homelessness and mental illness in the LGBT community. This means LGBT services remain vital, and are at times a lifeline for people who need specialist support and have nowhere else to turn.
“LGBT services are funded from such a wide variety of national and local government sources that the complexity may be masking the true impact of cuts.
“The Equalities Minister, Nicky Morgan, must ensure the government does the work needed to see clearly the full picture and intervene where necessary to protect the vitality and reach of LGBT services.”