Giving USA 2012, released this week, shows that charitable giving is making a very slow recovery following the Great Recession.
Giving USA is the most prestigious annual report on the state of charitable giving and reveals the current trends within the charitable sector.
The 2012 report was released on Monday and shows that in 2011 charitable giving in the US rose to $298.4 billion, up from $286.9 billion in 2010. This represents a 4% increase (0.9% adjusted for inflation).
The highlights of the report include the following:
- Individual giving, which represents the largest chunk of giving, increased by 0.8% in inflation-adjusted dollars. To put that number in context, personal disposable income rose 0.7% 2010 to 2011 (down from 2% growth 2009-1010).
Despite the fluctuation in personal income, individuals gave an average of 1.9% of their disposable income over the past two years. This stability, despite personal fluctuations suggests that generally people continue to be committed to maintaining their philanthropy. The question is, will that hold through what appears to be a protracted period of slow economic growth?
- Foundation giving fell 1.3% in inflation-adjusted dollars. The report suggested that the decrease was due to reduced asset growth from the continued economic weakness in the US and Europe.
- Corporate giving was flat. Corporate pre-tax profits only rose 4.1% in 2011, compared to a 25% increase the previous year. The S&P 500 index also declined in 2011 after two years of growth (10.9% in 2010 and 23.8% in 2009).
- Giving to international relief organizations continued to rise (by 7.6%) and rose more than any other sector. The increase in the number of organizations operating in the international sector has experienced considerable growth as well (an 80% increase between 1999 and 2009).
- Giving to religious organizations declined 1.7%, continuing a trend from the previous year. The report suggests that the decrease is likely the result of a corresponding decrease in church membership and attendance.
- With the exception of religious organizations and giving to foundations, where giving decreased 6.1%, other sectors saw modest increases in giving.
--Arts: plus 4.1%
--Education: plus 4.0%
--Environment/Animals: plus 4.6%
--Health: plus 2.7%
--Human Services: plus 2.5%
--Public-society benefit (e.g. United Way, etc): plus 4.0%
Giving USA offers a detailed executive summary free of charge at www.GivingUSAReports.org. You can also view a recorded webinar presented by Campbell and Company in cooperation with Giving USA. The webinar included a panel of nonprofit experts who gave suggestions for how charities can cope with difficult times.
Image: Chart from Giving USA
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Comments
Although growth is still slow and experts don’t expect it to fully recover for several years, it’s not all bad news. One important takeaway from this, as well as the 2012 Millennial Report published last week, is that developing relationships with your donors is more important now than ever before. If you cultivate a strong relationship over time, these individuals are more likely to give in the future when their financial situations improve.
Yes, you’re right, Vinod. We are recovering. Also, if there is one thing the economic downturn has taught the nonprofit community it is that engagement is the key to success. One of the panelists at the webinar that was held on Tues said that the main complaint she hears from donors is that they only hear from charities when they are asking for money. That seems odd to me when there are so many ways to communicate these days.