As many economic signs point to a slowing recovery, donors continued to hold tight to their wallets last year, increasing their contributions by slightly more than 2 percent after inflation, suggests “Giving USA,” the annual tally of charitable giving in America released today.
The small increase is hardly enough to help organizations out of the giant hole in donations created by the recession. “Giving USA” noted that the previous two years showed the steepest drop in giving ever recorded in the report’s five decades—a decline of 7 percent in 2008 and 6.2 percent in 2009. That tops the previous record decline from 1974, when the recession caused donations to drop by more than 5 percent. (See how “Giving USA” sharply changed its view of how giving fared in the most recent recession when it released today’s figures.)
“Giving USA” pegged the total of all philanthropic giving in the United States at $290.9-billion in 2010.
A Testament to U.S. Values
As always, the bulk of that money was raised from individuals. Donations by individuals remained essentially flat from 2009 to 2010—at 1.1 percent in inflation-adjusted dollars, for an estimated total of $211.8-billion. The rest came from corporations and foundations.
With households still reeling from the recession’s aftershocks, it’s not surprising that giving by individuals hasn’t fully bounced back, says Patrick Rooney, executive director of Indiana University’s Center on Philanthropy, which compiles the “Giving USA” report. “You see people regrowing their philanthropy, but because the economy is growing modestly, the recovery is modest,” says Mr. Rooney.
Donations typically equal about 2 percent of the nation’s gross domestic product—and, according to figures from “Giving USA,” it has stayed at about that level despite the ravages of the economy.
“When you think about the Great Recession, one might argue that this share should be higher,” he says. “But when you think about where it has been historically, this is a remarkable testament to the core values of Americans, especially when you look at stuff like housing values,” which have declined substantially over the last few years.
In such a giving climate, Mr. Rooney suggests, “persistence pays off” for fund raisers, along with communicating a charity’s message clearly to donors.
“Don’t give up on donors who had to give up on you,” he says. “There may be financial and emotional fallout with donors due to the recession, but if you stick with it over the long term, you may recapture them.”
Other key findings in the report:
- The biggest growth was in charitable bequests (which rose 16.9 percent, adjusted for inflation, to an estimated $22.8-billion) and corporate giving, which includes both product and cash support and rose 8.8 percent last year (to $15.3-billion).
- Grant-making by private, community, and operating foundations fell by 1.8 percent in 2010, to an estimated $41-billion, the study found.
- Among charitable causes, giving to American groups that work overseas grew the most (up 13.5 percent over 2009), followed by public-society benefit organizations (such as the United Way and Combined Federal Campaign, up 4.5 percent) and arts and cultural charities (up 4.1 percent).
- Environmental and animal-welfare groups suffered the biggest decline in support, down 2.3 percent from 2009 estimates. Human-service groups—a category that includes most giving for Haiti earthquake relief and recovery—saw the next largest drop in support, with a 1.5-percent decline from 2009, followed by religious causes, with a 0.8-percent dip. Researchers noted that human services would have had the biggest drop—5.6 percent—if giving for Haiti had been excluded.
An executive summary of the “Giving USA 2011” report’s key findings is available free at http://www.givingusareports.org. The full report is available from the Web site for $75; it includes two volumes, which are also available separately for $45 each.