After a global pandemic and unprecedented 2020, many nonprofit organizations were left with a lot of questions – “How will this affect our funding?” “Will we be able to fund our mission?” “How will we make up for lost revenue from our special event being cancelled?” However, in light of so much uncertainty, many Americans were asking, “What can I do to help?”
In 2020, a new record was set for charitable giving - $471.44 billion dollars. Here are our top 3 takeaways from this record-breaking year.
#1 – A shift in foundation and corporate giving trends
Foundation giving jumped by 17% in 2020, by individual, community, and operating foundations. Foundation giving typically follows the trend of the financial market, and in an up year for the markets, foundations were able to give more comparatively. Alternatively, corporate giving decreased by about 3%. This is due to a number of factors, including the knowledge that the economic impact of the pandemic was uneven across industries. Thanks to the report, we know that corporate giving trends tend to follow the GDP. The GDP declined by 2.3% in 2020, and corporate giving followed.
#2 – Giving to public-society benefit organizations experienced rapid growth in 2020.
$48 billion was given to public-society benefit organizations in 2020, about a 14% increase adjusted for inflation. This shows that in response to civil rights and social justice issues, urgent community needs and other pandemic-related issues, Americans significantly stepped up their giving in a time of need for the country. Many organizations had to find new ways to serve their communities and deliver on the mission while responding to a crisis that was unfolding in real-time, and those who were able to give responded to the need.
#3 – Individual giving as a share of disposable income remains flat.
Despite fluctuating financial markets, individual giving as a share of household disposable income remained low in 2020, at only about 2% of income. This percentage has hovered at or near the 2% mark since 1980, and is a determinant of how much a household may give from income vs. from wealth. The average gift from individuals in 2020 was $2,766.
Overall, the Giving USA report was encouraging! It shows that Americans are ready and willing to give, organizations are adapting to the needs of the communities they serve in real time, and donors remain engaged with organizations even without face-to-face time.
Stay tuned for more blog posts about Giving USA and how this unique year may shape the future of philanthropy.
-- Audrey Tapling, Senior Consultant
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