--P.T. Barnum
For many Mormons the growth rate of the Church represents its veracity. Why would people join the Church in droves if it is not true? Well, the problem with this logic is that it isn't logical. In fact, it is the classic logical fallacy "argumentum ad populum" (argument from popularity). Truth is not a democracy. Besides, many religions boast much higher growth rates, including atheists. Does this mean that they are true? If the Mormon Church's growth rates are on the decline, would this mean it is not true?
According to an article on Richard Packham's site, in 1999 alone the Mormon Church added 306,171 members to their 10,752,986 total membership, while the Seventh-Day Adventists (a much younger religion, mind you) claimed 1,090,848 new members to their 10 million total membership. Mr Packham explains why this is so problematic for the Church:

Until recently I did not know that Mormon higher-ups are offered a salary if they want it, since they usually have to quit their day job when accepting such time-consuming positions. The Church openly criticizes other churches for paying their clergy members, so this puts them in an awkward position, doesn't it? But setting aside any apparent hypocrisy, the real issue is what the Church is currently doing to boost "sales".
In the 80s the Church saw its greatest period of growth, and by the year 2000, despite having twice as many missionaries actively proselytizing, their growth rate dropped to about half. Current figures are difficult to come by, as the Church is very secretive of its membership records (and finances). But it is clear to me at least that they are desperately grasping for anyone willing to buy the snake oil.

It is difficult to say what would fix the dilemma Mormonism currently faces. If I were interested in finding a remedy (cough, cough), I would suggest they should try being more forthright and honest about their history and odd doctrines. But let's face it, there is a reason they have been so secretive all these years....
BONUS MATERIAL:
Here is the official press release announcing the changes to missionary ages, which Elder Holland says is because "god is hastening his work" (which implies that the Second Coming of Christ is fast approaching, and says nothing about declining membership. Score "1" for being forthright and honest. Oh wait....):
Here is the Mormon Church exploiting compassion towards disabled children to promote their religion:
Well, two can play that game:
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