Strong American Philanthropy at a Record High!

Americans donated an estimated $358.38 billion in 2014, surpassing the peak last seen before the Great Recession, according to the 60th anniversary edition of Giving USA, released today. That overall total slightly exceeds the benchmark year of 2007, when giving hit an estimated inflation-adjusted total of $355.17 billion. However, Individual giving has yet to recover fully.

The 2014 philanthropy total increased by 5.4 percent, when inflation adjusted, over the revised estimate of $339.94 billion that Americans donated in 2013. Giving has grown for each of the previous five years. The growth in 2014 significantly outpaces the average growth rate of 3.4 percent (inflation adjusted) during the past five-year period.

All four sources of contributions that comprise total giving increased in 2014:

  • Individuals (72 percent of the total, 4 percent inflation-adjusted increase)
  • Corporations (5 percent of the total, 11.9 percent inflation-adjusted increase)
  • Foundations (15 percent of the total, 8.2 percent inflation-adjusted increase)
  • Bequests (8 percent of the total, 13.6 inflation-adjusted increase)

Giving USA 8.5 x 11 Infographic“The 60 year high for total giving is a great story about resilience and perseverance,” says W. Keith Curtis, Chairman of the Giving USA Foundation and President of The Curtis Group. “It’s also interesting to consider that growth was across the board, even though criteria used to make decisions about giving differ for each source.”

When combining the Individual and Bequest numbers, we see that individuals contributed 80 percent of all dollars given to charity in 2014. If we include family foundation giving, individual philanthropy accounted for 87 percent of all dollars given in 2014, according to Patrick Rooney, PhD, Associate Dean for Academic Affairs and Research at the Indiana University Lilly Family School of Philanthropy. Large Individual gifts of $200 million or more accounted for a significant portion of the overall growth in Individual giving while the actual number of gifts over $1 million has decreased.

“We saw several very large gifts greater than $200 million — a few were greater than $500 million and one was nearly $2 billion — in 2014,” says Rooney. “The majority of these mega-gifts were given by relatively young tech entrepreneurs.”

Looking at the nine gift recipient categories, all but one saw an increase in giving:

  • Religion (0.9 percent inflation-adjusted increase)
  • Education (3.2 percent inflation-adjusted increase)
  • Human Services (1.9 percent inflation-adjusted increase)
  • Health (3.8 percent inflation-adjusted increase)
  • Arts/Culture/Humanities (7.4 percent inflation-adjusted increase)
  • Environment/Animals (5.3 percent inflation-adjusted increase)
  • Public Society Benefit (3.4 percent inflation-adjusted increase)
  • Foundations (0.1 percent inflation-adjusted increase)
  • International Affairs (3.6 percent inflation-adjusted decrease)

“While the overall growth is indicative of robust philanthropy to a wide spectrum of nonprofits and, thus, of all boats rising with the tide, we would be remiss to gloss over what is happening with giving to religion. Although 2014 donations reached a new high of $114.90 billion and, as always, accounted for the largest percentage of donations, the fact is, this category is continuing its 30-year dramatic downward slide as a share of total giving. In fact, it has dropped from 53 percent of all donations in 1987 to 32 percent of the total in 2014,” says David H. King, CFRE, Chairman of the Giving Institute and President of Alexander Haas.

While virtually all sectors experienced growth, giving to International Affairs saw a decline. This might be due to the fact that there were no major international disasters in 2014 on the scale that we have seen in recent years, according to Robert Evans, Board Member of the Giving Institute and President of the Evans Consulting Group. In the USA, giving to international causes is influenced by catastrophic international events.

Rooney believes that the nonprofit sector should be particularly pleased by the growth in overall giving:

 

 

While the news is mostly excellent, Rooney suggests that nonprofit organizations should be concerned about corporate giving and contributions to Religion:

 

 

Giving USA 2015: The Annual Report on Philanthropy for the Year 2014 is a publication of the Giving USA Foundation, and is researched and written by the Indiana University Lilly Family School of Philanthropy. For more information, a free executive summary, Highlights, is available by clicking here. For a fee, readers can order a copy of the full report, in digital or paperback formats, in addition to a PowerPoint slide deck, by clicking here.

The bottom line is that giving in 2014 was robust. Because overall philanthropy closely correlates to Gross Domestic Product at the rate of about two percent (2.1 percent for 2014), it looks like 2015 is likely to be another growth year. For those who might be worried that the presidential campaigns will siphon philanthropic dollars away from nonprofit organizations, fear not; Rooney says there is no historical evidence to suggest that this happens.

To ensure future success, Evans offers three tips for charities:

  • Be creative. However, don’t forget the fundamentals. For example, online giving campaigns can certainly be creative; unfortunately, online giving accounts for less than five percent of total giving.
  • Show supporters and potential supporters the impact they have had and can have through their donations. Donors want to feel they are accomplishing something significant with their money.
  • Robust, meaningful recognition of donors is essential. Fewer donors are seeking to give anonymously. So, be prepared to recognize them in ways they will appreciate.

So, how is your organization’s philanthropic health? Take the poll:

That’s what Michael Rosen says… What do you say?

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2 Comments to “Strong American Philanthropy at a Record High!”

  1. Happy to hear especially about the Arts and Culture increase. They are usually relegated to the bottom.

    • Steve, thanks for your comment. Yes, it’s nice to see the Arts rebounding. During tough times, donors tend to view the Arts as a luxury while other causes (i.e.: Human Services) are a necessity. So, a strong increase in Arts funding is great news for the Arts community; it’s also great news for the economic outlook in general since it would seem to indicate that people are sufficiently optimistic to justify returning to giving to a “luxury.”

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