U.S. Charitable Giving Increases Modestly in 2011

by Robert I. Evans and Avrum D. Lapin

Giving USA: The Annual Report on Philanthropy, issued today by the Giving USA Foundation and its research partner, the Center on Philanthropy at Indiana University, is considered the most reliable and prominent resource for information about trends in charitable giving and announced that giving increased modestly last year.

The report reviews giving by all types of donors and while it does not feature any special groups or geographical parts of the U.S., we looked at the report with a Jewish perspective.

Charitable giving in the United States increased in real dollars in 2011 by 4.0%, reflecting the second consecutive year of collective higher charitable support from individuals, corporations, foundations, and bequests, according to the annual landmark report that has tracked philanthropy for more than 50 years.

With the issue of the Report came some important highlights that reflect significant pressures facing the 1.1 million nonprofits and another 222,000 religious organizations across the U.S., including changes in behaviors by American donors of all types, especially individuals who collectively represent 88% of all giving.

The 2011 estimate of $298.42 billion represents growth from a re-stated figure of $286.91 billion given in 2010.

Giving USA: The Annual Report on Philanthropy has detailed annual estimated charitable contributions by Americans – and how they are used – since 1956, making it the longest-running study of its kind. The Report does not show changes by any one organization or regions across the country; rather, it reflects total giving by 117 million households, approximately 12.4 million corporations, an estimated 99,000 estates, and approximately 76,000 foundations.

In advance of the release today of the Report, we spoke with both Dr. Patrick Rooney, Executive Director of the Center on Philanthropy, plus several other experts involved with data gathering and interpreting the results.

“The estimates for giving in 2011 are encouraging, but they demonstrate that charities still face ongoing challenges,” Dr. Rooney observed. “In the past two years charitable giving has experienced its second slowest recovery following any recession since 1971.”

Among the highlights of the GUSA Report for 2011 are several critical observations that have likely relevance to Jewish donors and organizations serving the global Jewish community. Most notably we observed the following trends and implications:

Giving to Religion: Giving to “houses of worship” in the U.S. remains the largest single category attracting donor support, but for the second consecutive year, this sector reflected a decline in both total dollars given and as a percentage of overall giving. Giving to religion, making up 32% of all giving, declined by 1.7% in real dollars and 4.7% in inflation-adjusted dollars. This decline is attributed to a steady decline in religious affiliation across the country in all denominations, including Jewish memberships in synagogues.

Giving to International Issues: Giving by all sources to international organizations grew 240% in current dollars, or 167.1% in inflation-adjusted dollars between 2001 and 2011, and 7.6% alone in 2011. While there were no major international incidents in 2011 that garnered major support (excluding the Japanese tsunami), we suspect that very large donors, including the Gates Foundation, are still supporting international projects in substantial ways. Included in this category, too, are a number of Israel-focused efforts, although some American friends organizations are likely to have their results included in other categories, including education, arts and culture, and health and medical sectors.

Giving to Education: Education, specifically support for colleges and universities, saw a 4.0% increase in giving, and it remains the second largest sector that donors support. Very large capital campaigns returned to college campus fundraising efforts in 2010 and 2011, and impacted this aspect of the nonprofit world. We saw very large seven, eight, and nine figure pledges and gifts in this sector. Several Israel-based universities recorded very substantial increases in giving in 2011.

Giving to Public-Society Benefit: Charitable support for traditional “umbrella organizations,” including the Jewish Federations of North America (JFNA), increased by 4.0% in 2011. However, this category’s figures are clouded because once again GUSA included dollars attributed to donor advised funds as well as to United Ways and the Combined Federal Campaign into the overall calculation. Incoming funds to the  Jewish Communal Fund and other donor-advised fund administrators grew collectively 77% between 2010 and 2011.

Several other highlights from the GUSA 2011 Report include the following:

1. Support for nonprofits via bequests increased 12.2% to an estimated $24.41 billion.
2. Giving by foundations did increase 1.8%, however when adjusted for inflation giving by foundations declined 1.3% in 2011.
3. Giving by U.S. corporations and their foundations held steady at $14.55 billion.
4. Giving to human services nonprofits rose an estimated 2.5% last year and is the third-highest amount ever recorded (behind 2008 and 2010)
5. America’s charities face many challenges including increasing competition from more than 1.1 million nonprofits and an economy that is recovering far slower than we have witnessed following previous downturns.
6. The “best” year for giving ever was 2007, when GUSA reported $309.76 billion in charitable support. The 2011 results are the closest that total giving has been to $300 billion since 2007.

The complete GUSA report as well as an executive summary is available at GivingUSAReports.org.

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 eJewishPhilanthropy.com. 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; TWITTER: @EHLConsultGrp; EHL Consulting Group Blog: biggiver.wordpress.com