Philanthropic giving is expected to increase 4.8 percent this year, and 4.9 percent in 2016, exceeding the average rate of growth in gifts since the recession, according to a forecast released Tuesday.
Gifts from individuals, corporations, estates, and foundations are all expected to increase, according to the Philanthropy Outlook, a set of projections made by researchers at Indiana University’s Lilly Family School of Philanthropy and Marts & Lundy, a philanthropy consulting firm.
Foundations, which were badly bruised by losses in the stock market during the downturn, are primed for the most growth, says Una Osili, director of research at the school. Many foundations peg their grant cycles to multiyear averages of the stock market and are finally ready to deploy some of the market gains they’ve made in the past few years. That should contribute to a 7.2-percent increase in foundation grants this year and a 6.7 percent increase in 2016, the study predicts.
Corporate giving is expected to rise 6 percent this year and 4.8 percent in 2016; gifts by individuals are projected to rise 4.4 percent and 4.1 percent during the next two years.
Gifts by estates, which are much more variable, are expected to increase 2.7 percent this year and 6.3 percent in 2016. The small projected increase in estate giving this year is due in part to a roughly $1-billion bequest fulfilled in 2014 by the estate of the late Ralph Wilson, who owned the Buffalo Bills football team.
The projected growth, which is adjusted for expected inflation, is higher than the 3.1 percent average annual rate of growth in the years since the recession tabulated by "Giving USA" study, which is produced by the Lilly School and the Giving USA Foundation. That annual report uses tax filings and other data to estimate how much Americans gave in previous years.
The growth expected this year and next still falls short of the 5.1-percent average rate charted over the past 40 years. But Ms. Osili points out that they are still an improvement over the steep declines suffered during the recession—like a 14 percent drop in 2009, according to one estimate.
Another report, by The Atlas of Giving, offers a far different forecast. It expects giving to decline 3.2 percent in 2015, largely because of an expected decline in the stock markets and a possible increase in interest rates.
Both reports use a variety of data, including projected increases in the Gross Domestic Product, household wealth, employment, and corporate profits to make their projections. However, the Atlas of Giving and "Giving USA" reports have often produced drastically different conclusions on how much Americans give. In 2013, for instance, there was a $50-billion gulf between the two groups’ estimates.
Ms. Osili says the new Philanthropy Outlook study is different because other researchers will be able to check their work and take a "deep dive" into how they came to their conclusions.
"The Atlas does not publish its methodology," she says. "Ours is verifiable and validated."
Rob Mitchell, chief executive of the Atlas of Giving, has said that he’s willing to work with an academic institution to verify his results but that he won’t make his research methods public.