Preparing for and Predicting the Future of Giving

Can We Be Proactive and Keep Support from Going Elsewhere?”

by Robert I. Evans and Avrum D. Lapin

As the story of the exodus of Jews from Egypt lingers in our minds, we can’t help but think about current Jewish migration patterns and how this affects today’s Jewish non-profit organizations. Demographic shifts bring changes in personal giving priorities: donors form new bonds and old ties diminish as people traverse the country and the globe. Where does that leave Jewish non-profits that position themselves to obtain and retain support?

This set of questions prompted us to contact two respected researchers and experts on charitable giving at the Boston College Center on Wealth and Philanthropy, Paul Schervish, director, and John Havens, associate director and senior research associate. They recently authored two important research reports that intrigued us and which have captured some significant attention: Individual Giving Model: Forecast For 2009 and Migration of Wealth in New Jersey and the Impact on Wealth and Philanthropy.

Many of us dream about being able to accurately predict how donors will make charitable gifts and then imagine if we could project the level of funding required to support existing as well as new programs and services. With accurate predictions, non-profits and fundraising professionals might function differently and with more certainty and predictability!

This approach motivated Schervish and Havens to create the Individual Giving Model (IGM), a complex tool to measure short-term charitable giving predictions. Their system differs markedly from many other models today, primarily because other approaches lag by at least one year in their predictions. The IGM has demonstrated accurate giving references and thus is a useful tool in measuring giving patterns going forward.

For 2008, the IGM estimated a 5.7% decrease for individual giving based on inflation which is in sync with Giving USA’s findings. For 2010, in both low and high growth scenarios, Schervish and Havens predict that individual giving in the United States will decrease only slightly from 2009 levels, which is certainly promising news. Jewish giving was not a specific focus of their predictions, but they contend that Jewish giving statistics will not differ appreciably from mainstream Americana.

Schervish and Havens explained that their model, like many others, does not include data on religion or ethnicity, so they cannot currently predict giving to Jewish causes or by Jewish donors. However, the model does give us hope that ultimately we will be able to isolate predictable factors that, when combined, will lead to accurate predictions that will help Jewish non-profits adjust for certain aspects of planning and financial management.

In considering individual giving patterns, we also thought about the impact of population changes on charitable giving: how do Jewish organizations maintain support even as their members/donors relocate and what pro-active steps are possible to retain support? Schervish and Havens tackled these questions, too, when they looked at New Jersey and giving patterns in that state. With a substantial Jewish population, New Jersey has seen especially significant outward population changes so we wondered how Jewish agencies could re-position themselves, especially considering the modeling approach and other factors, to maintain support from those who go elsewhere. How population swings impact on future charitable giving must be a strategy to be addressed by non-profit professional and volunteer leaders.

In the landmark study commissioned for the Community Foundation of New Jersey and the Enterprise Trust at the New Jersey Chamber of Commerce, Havens found that New Jersey experienced an out-migration of wealth that was significantly larger than in-migration of wealth between 2004 and 2008, with an expected loss of $2 billion in charitable giving to New Jersey non-profit organizations. What Havens confirmed is that individuals leaving New Jersey are migrating primarily to New York, Pennsylvania, and Florida and they tend to be older and have more wealth than the individuals and families migrating into New Jersey. Charitable giving implications are serious for New Jersey’s non-profits, where they stand to lose significant support unless they take creative and pro-active measures.

New Jersey does not stand alone on this; other traditional Jewish population centers need to heed various messages from the Havens research. Even using the IGM model, long term reliable predictions about giving may be difficult for the Jewish community but we are most concerned about practical steps that Jewish organizations consider as they handle significant transformational demographic changes. The key question, perhaps, is asking what to do to retain important donors who are leaving for new locations. How do you keep these individuals active as donors when they are no longer volunteering or having regular contact?

We have been working with one prominent, large congregation that holds special events in Florida for transplanted members and snowbirds every February. We wanted to keep these individuals connected although they are either permanently or temporarily geographically far away. Our client has addressed population changes by offering radio and web broadcasts of various religious services and certain educational programs on their web site, and ultimately keeps them connected to the congregation’s family with periodic telephone calls from Board members and clergy.

When asked about maintaining connections with people moving from one locale to another, Schervish suggested that every organization “create a special category of emeritus members/donors who have re-located. Do everything possible to maintain active outreach to maintain connections,” he urged. “Don’t let people vanish!”

But his best suggestion for all organizations witnessing population transitions: take a lesson from the successes of snowbird activities and hold summertime events back home. Think creatively, he offered, to keep past members/donors engaged while also focusing on attracting new members and donors. While individuals may leave an area for a number of reasons and look for new organizations to fulfill life cycle, spiritual, and social needs, every organization has an opportunity to strengthen and maintain longstanding ties.

Robert I. Evans, Managing Director, and Avrum D. Lapin, Director, are principals of The EHL Consulting Group, of suburban Philadelphia, and are frequent contributors to EHL Consulting works with dozens of nonprofits on fundraising, strategic planning, and non-profit business practices. Become a fan of The EHL Consulting Group on Facebook.