On December 30 of last year, National Public Radio aired a segment on All Things Considered with the headline, “Charitable Giving Sees Big Bump In 2016.” Among the indications noted by reporter Pam Fessler that 2016 would be a good year for fundraising, $168 million was donated nationwide on Giving Tuesday, a 44% increase over the previous year.
Here are some other positive signs mentioned in the NPR report. Lorie Slutsky, president of the New York Community Trust, said that donations to her charity were up $35 million for the year. Ron Busroe, who oversees fundraising and community relations for the Salvation Army, reported a 12 percent increase the Salvation Army’s online fundraising for the year and that its annual Red Kettle campaign was on track to break 2015’s record amount. More broadly, Stacy Palmer, editor of the Chronicle of Philanthropy, predicted charitable donations would be up 4 percent to 5 percent for the year.
Increase in Donations Temporary?
This all seems like very good news for fundraisers. Donors are giving more. But are they? The motivations behind the “big bump” in giving could be short-lived. Lorie Slutsky told of a donor who had quadrupled his usual gift on advice of his accountant, who is worried that tax changes under the Trump administration may reduce the tax benefits of making a charitable gift. She has heard a similar story from other donors. Also, some progressive charities, such as Planned Parenthood and the ACLU, saw huge increases in donations immediately after the presidential election. Will those donations continue in the coming years? Maybe. Maybe not.
A Downward Trend
And then there’s this. Economists at Texas A&M, in a paper released in December 2016, found that “patterns of charitable giving around the time of the Great Recession indicate that the propensity to give fell sharply and stayed well below previous levels,” even after controlling for income, wealth, demographic, and state of residence effects. Analyzing data collected on over 13,000 individuals, they found that in 2012, well into the recovery from the financial crisis of 2008-2009, the likelihood an individual gave to charity was still declining and at an accelerating rate. The amount given was also still declining. Having controlled for financial influences on giving behavior, they suggest that uncertainty triggered by the shock of the Great Recession could be the cause of the persistent decline in giving that they observed. Their data stops in 2013, so we don’t know if the same trend has persisted to the present.
So, what we have at the moment are mixed messages. In the short term, giving appears to be up from previous years. But the motivations for the increase may be transient. What’s more, there is evidence that the long-term trend may be one of less giving per donor and a lower proportion of people making gifts.
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