Monday, June 29, 2015

Good News or Bad? Giving USA 2014 Report

Giving USA just came out with its annual report on 2014 charitable giving in the United States

Here are some top findings on the good news side:
  • A record $358.4 billion was contributed to nonprofits in 2014, an increase of 5.4% over the previous year.
  • Donations from individuals, corporations, and foundations all exceeded the previous all-time high of 2007 (right before the recession caused donations to plunge.)
  • This recovery from the recent recession was the shortest on record, and much faster than all the experts predicted.
  • Charitable giving rose in all service areas except international aid (which is largely driven by situational disaster assistance). Arts, culture, and the humanities were tops with a 7.4% increase followed by the environment and animal welfare at 5.3%.
  • Corporate giving increased a remarkable 12%, largely due to big growth in pre-tax profits and the Gross Domestic Product (GDP).
  • Individual giving accounted for an astonishing 58% of the increase in giving in 2014.
And on the not-so-good news side:
  • Corporate dollars were up - but not by much - .7% of pre-tax income (compared to 1.8% in 1985 and 2% in 1986). And much of this giving was in-kind rather than actual dollars.
  • Religion still reigns at 32% of total gifts, but has been losing ground to other causes since 1982 when it topped the charts at 53%.
  • This past recession hit harder than originally estimated, with a 14% decrease in gifts from 2007-2009 - making it the most serious decline since Giving USA started keeping count 60 years ago.
  • Despite the big 2014 increase in individual giving, the average donated remained consistent at 2% of disposable income. This hasn't varied over time, even when the economy has been strong.
  • Individual giving is not increasing as fast as giving by corporations and foundations - total contributed in 2014 was $258.5 billion, still short of the 2007 high.
Reading between the lines, the other important story is that the increase in individual giving has largely been driven by donations from "mega-donors." These gifts in the range of $80 million and up are being designated for big mainstream institutions (universities, hospitals, museums, etc.) as well as foundations that provide grants for big nonprofits.

In other words, a very small number of donors are controlling our philanthropic dollars, and they are not giving to small and mid-sized organizations that serve the neediest among us. The income inequality we are seeing throughout the country is indeed being reflected in the current landscape of charitable giving.

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