Fundraising Update

Welcome to Fundraising Update. This week, a new report shows the share of households that give to charity reached a low point in 2018. We discuss what to make of that. Plus, why trust in nonprofits slipped during the pandemic.

I’m Eden Stiffman, senior editor at the Chronicle of Philanthropy. If you have ideas, comments, or questions about this newsletter, please write me.

Thanks to sponsor Blackbaud for supporting Fundraising Update.

Only Half of Households Gave to Charity in 2018

A study out this week confirms a trend that has long worried experts who follow philanthropy: Donations to charitable causes are reaching record highs, but the giving is done by a smaller and smaller slice of the population.

For the first time in nearly two decades, only half of U.S. households donated to a charity in 2018.

Haleluya Hadero, who follows philanthropy for the Associated Press in partnership with the Chronicle to expand coverage of the nonprofit world, provided key details and analysis on the biennial study by Indiana University’s Lilly Family School of Philanthropy. The data comes from a survey that has been tracking the giving patterns of more than 9,000 households since 2000, when 66 percent of U.S. households donated to a charitable organization. That number dropped to 49.6 percent in 2018, the latest year with comprehensive figures from those households.

Many factors are contributing to the decline. The percentage of Americans who give to religious causes has decreased in tandem with attendance at worship services as the number of Americans not affiliated with any religion grows. Separately, the share of Americans who give to secular causes began to drop following the economic turbulence of the Great Recession, but it hasn’t bounced back. It reached a new low — 42 percent — in 2018, the study found.

What we don’t know yet: Did the pandemic create a “shock” to normal patterns of giving that could at least temporarily disrupt the long-term trend of fewer Americans’ giving? Una Osili, the associate dean for research and international programs at the Lilly School, told me in January that new giving habits may stick when people start going back to familiar patterns of consumption.

Some experts say it’s time to rethink how we talk about the share of Americans who give. Laura MacDonald, who now chairs the Giving USA Foundation, said in an interview last year that “if we broaden our time horizon and look over a broader period of time, it’s actually a higher percentage” who give. “We may see that Americans are expressing their generosity in any number of ways, which might or might not be counted in our formal philanthropic economy.”

The new report has its limitations. It measures giving to nonprofit organizations but doesn’t capture donations made through informal crowdfunding campaigns, which tend to draw younger audiences. It also doesn’t measure contributions of goods and services.

The study says declining levels of trust among Americans for most institutions and each other may also contribute to the move away from charitable giving. (Scroll on for more on the trust issue facing nonprofits.) That mistrust is especially pronounced among millennials, which could cause another layer of challenges for charitable organizations.

The data shows a majority of households headed by a person with a college or a graduate degree who was married or widowed gave to charity. Wealth was also a factor: Nearly eight out of 10 households with more than $200,000 of wealth contributed to a nonprofit in 2018, the study said. By contrast, fewer than four in 10 households with wealth less than $50,000 made donations.

“The overall pie [in giving] is slowly moving towards the ultra-wealthy,” John List, an economics professor at the University of Chicago who studies giving, told Haleluya. He added that this shift can be dangerous. “Rich people give to causes that rich people want to give to,” he said. “You have a very different supply of goods and services from the charitable community when the rich people give versus when the middle-class or lower-class gives.”

Read the full story for more on what charities can do about this trend.

Hear From You

How has the number of active donors changed at your nonprofit in recent years? How are you and your fundraising colleagues responding? Drop me a line. I’d love to hear from you.

In This College Class, Students Become Grant Makers

Today’s college students — most of whom belong to Generation Z — are still decades away from their prime giving years, but they’re already making contributions. Still, most donors don’t learn about the practical nuances of giving until well into adulthood. My colleague Emily Haynes writes about an undergraduate course at the University of California at Los Angeles that is working to change that.

During the Philanthropy as Civic Engagement course, students research local nonprofits, visit with charity executives, and discuss how to make the greatest impact through giving. After 10 weeks of debate and deliberation, they vote on how to award $80,000 among three Los Angeles nonprofits.

“This generation that we are privileged to educate in higher education right now is terrific,” says assistant vice provost Jennifer Lindholm, who teaches the UCLA course. “They have a weight of responsibility that they are faced with. I think that could be daunting, I think it could be overwhelming, and I think that it is our responsibility as educators to really help support them in learning how to lead and how to thrive.”

The class and others that have been held at 26 universities are underwritten by the Philanthropy Lab program at the Once Upon a Time Foundation, a family foundation in Fort Worth, Tex. Many of those institutions, including UCLA, now raise money to pay for the courses in their entirety.

Students say the grant-making experience was humbling. “When it’s actually in practice, it’s a lot more difficult than you could ever imagine,” Johnny Perez, a first-year psychology major, who took the course last spring, told Emily.

Take some time to read more about the course and why it’s so important to educate young people about giving.

Need to Know

Trust in nonprofits hinges on the same political and income divides that split the United States. That’s one of the main findings of a new survey from Independent Sector my colleague Drew Lindsay wrote about. Affluent Americans with college educations have consistently more trust in the nonprofit world than others who have less income and less education. Similarly, Democrats and urban dwellers put more faith in nonprofits than do Republicans and rural residents.

As nonprofits have stepped up to meet the extraordinary demands of the pandemic, Americans’ trust slipped a bit for nonprofits while eroding significantly for individual philanthropists and corporate and private foundations. An accompanying report noted that virtually all institutions in America lost a measure of trust during 2020. The nonprofit world, like others, has wrestled for years with what has been called a “trust crisis.”

Plus:

• Officials at St. Jude Children’s Research Hospital say they’ve reached a new milestone: The charity raised $2 billion in its 2021 fiscal year. That marks the first time a single-mission charity has reached that milestone, St. Jude told Glenn Gamboa, who reports on philanthropy for the Associated Press. St. Jude hopes to do it again — at least five more times, in fact — to fund its six-year, $11.5 billion strategic plan to accelerate research and treatment globally for children with catastrophic illnesses, especially cancer.

  Because about 87 percent of the nonprofit’s revenue comes from individuals rather than major donors or corporations, it faced a fundraising threat during the pandemic. The organization either hosted or was the beneficiary of more than 30,000 fundraising events in the pre-pandemic world. But it was able to shift its in-person events to virtual and generally expand its digital fundraising reach. The hospital promoted its work not only on major social-media platforms like Facebook and Twitter but also on the exercise platform Strava and the gamer haven Twitch. Those investments have been paying off.

Tips & Tools

• Researcher on Donors and Fundraising Reflects on What Nonprofit Supporters Want: As Penelope Burk releases her final survey of nonprofit donors, she talks about how to put the focus on supporters and what needs to change in fundraising to make it better.
• If You Want to Work for Our Nonprofit, You Need to Get Vaccinated: The Los Angeles LGBT Center, like many organizations across the country, struggled with whether to require employees to get the Covid-19 vaccine. Its journey offers lessons for other nonprofits grappling with this issue.
• Plus, make sure to save the date for our online forum next Tuesday, August 3, from 3:30 to 4:30 p.m. Eastern. You’ll learn from nonprofit leaders who will share steps they took to diversify their staffs and create cultures that welcome diverse perspectives. They’ll share their experiences and offer advice on how — and why — to build diverse organizations. Register here.

What We’re Reading

• After a tough year, and months of applications and waiting, performance venues are finally receiving federal pandemic relief funds. In Massachusetts, some are using the money for overdue renovations or to adapt the spaces to a changed world, installing sophisticated air filtration, security-screening systems, and touchless bathroom fixtures. Others are restoring lost pay and bringing workers back from furloughs. The $16 billion Shuttered Venue Operators Grant provides 45 percent of a venue’s 2019 earned revenue, up to $10 million, for spaces whose ticket revenue disappeared last year. It had a rocky start of computer glitches and confusing paperwork, but midstream reforms got it going. (Boston Globe)
• What’s really happening with charity checkout campaigns? In 2020, more than $605 million was raised by a group of charity fundraising campaigns at retail cash registers. Seventy-six such campaigns each raised in excess of $1 million, according to a survey by Engage for Good, which helps businesses and nonprofits work together. But last month, a meme circulated showing a smiling Walmart cashier politely asking a customer for a donation to a local charity so the company could give it in its own name and get a tax write-off while continuing to pay her minimum wage. According to a November piece from, the Tax Policy Center, an Urban Institute and Brookings Institution think tank, only customers can claim the donation as a deduction on their tax returns (though apparently individual customers rarely do). The store is only the collection agent. What the retailer gets is positive PR for helping a good cause. (Tampa Bay Times)
• The website of the small nonprofit One Simple Wish crashed after a comment on the social-media site Reddit prompted hundreds to donate to kids in foster care. The nonprofit posts requests from current and former kids in foster care across the country, and anyone can sign on and grant the wishes, such as clothes, athletic equipment, and school supplies. People flocked to the group’s site after someone posted about an 11-year-old whose foster family couldn’t afford to buy a bike for his birthday. “For less than $200, I paid for the kid’s new bike,” the Reddit user dartdoug posted. In the three weeks since his comment, more than 1,500 wishes have been granted on the website, and an additional $200,000 has been contributed to help grant future wishes (Washington Post).

#EquityTalk: Who to Listen to?

This fall, the Chronicle will profile people remaking their organizations and the nonprofit field as a whole to advance equity. We would like to know who you are listening to — writers, activists, podcast hosts, and social-media influencers as well as leaders, fundraisers, and other frontline workers bringing about change that’s driving conversations. Please use this form to provide as many as three names. Thank you!