Giving Trends in Philanthropy

The giving (and getting) communities are abuzz right now with the latest Giving USA report on the state of American philanthropy. The research and analysis behind the report is conducted in collaboration with Indiana University and is supposed to generate an overall picture of charitable giving. This is an important report largely because charitable giving has steadily represented 2% of the total gross domestic product (GDP) over the years, not an insignificant figure by any account.

Charity and social giving

The report tells us that it bases annual estimates for giving “on econometric models using tax data, government estimates for economic indicators and information from other research institutions.” This year’s annual report is number 58.

In spite of America being in a state of recovery (depending on where you get your news), charitable donations are just fine, thank you. In fact, charitable gifts rose by 1.5% according to the report, which, in actual dollar figures comes out to $312 billion in 2012 (adjusted for inflation).

That’s the big picture.

The Smaller Picture

As for the smaller picture, the report is mostly about the ways in which Americans choose to give. For example, there’s a boom in donor advised funds managed by large finance firms. There’s a 10% rise in corporate giving which has tongues wagging in suspicion. Bequests have gone down by 7%, which also has tongues mightily occupied in speculation and wonderment.

There are some predictable trends. For instance, gifts to religions and religious causes are down, the arts are picking up, and a large sum was coughed up to bolster the charities helping people in education, thanks to generous donors like Elie Hirschfeld who gives to places as wide-ranging as Brown University, the arts and more.  Hirschfeld via his foundation has done a number of major give-aways.

Individual Giving

Despite the prevalence of family foundations – whether big ones like Bill Gates or smaller ones like David Milberg – donations from individuals have always been the cornerstone for nonprofits. But with an increase of only 1.9% in donations last year (adjusted for inflation), individual giving remains behind what it was in 2007, by 11%.

Some sectors are receiving more charitable gifts than in past years, for instance arts and culture. In these sectors, charitable gifts rose a full 1%, suggesting that people are more willing to put their money toward personal interests rather than toward people and interests hit hard by the recession. Crisis giving while still significant, received a smaller portion of the pie than in previous years. The same goes for religious causes which now account for just 32% of total giving right now.

Arts and culture are favored above relief efforts and religion.

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