Insights from GivingUSA 2023: Giving Was Down Last Year, But It’s Complicated

Understanding the Shift in American Philanthropy: A Look at Giving USA 2023 Report

Americans gave over $499 billion in 2022. That’s what researchers at the Lilly Family School of Philanthropy report in Giving USA 2023, a public service of the Giving Institute, the definitive study of annual philanthropy.  That’s a massive amount of generosity, but it’s not great news for fundraisers. Giving set a record in 2020 and 2021, as pandemic needs and some record stock numbers combined to fuel generosity. Alas, the record inflation, along with a drop in key market indexes in the calendar year of 2022 pushed American charitable giving to drop. This has happened only three times in the past 40 years, in each case after significant economic hurdles like this.  Some key stats:

 
• Overall giving declined 3.4 percent from 2021
 
• This is a decline of 10.4 percent when corrected by inflation.
 
• Individual giving declined by 6.4%
 
• Foundation giving increased by 2.5%
 
• Giving by corporations increased by 3.4%

As we consider the individual giving numbers, let’s remember that inflation hit 8%, and personal income was flat in current dollars overall. And, the S&P 500 dropped 19.4% on the year, cratering massively at the end of the year when many people give. (We know, you were there). It was a tough year for many donors.  The sponsors of the report said it best: “Drops in the stock market and high inflation caused many households to make tough decisions about their charitable giving for the year,” said Josh Birkholz, Chair of Giving USA Foundation and CEO of BWF. “But despite uncertain economic times, Americans demonstrated how essential they view the nonprofit sector and its ability to solve big problems—by still giving nearly half a trillion dollars in 2022.”  It’s interesting to note where giving rose and fell. Education, public-society benefit and environmental giving declined. Religion, International affairs, arts, culture and humanities, and health giving saw increases. Giving to foundations saw an increase of 10.1 percent.  The foundation giving numbers represent a change in giving that we’ve been talking about. Family foundation strength was the biggest contributor to the increase in foundation giving this year. As we travel to giving events and conferences what we hear is high interest in giving in ways that have a defined, planned impact rather than just cutting checks blindly to charities.  Additionally, there are ways people are contributing to good that might not be picked up through the normal charitable streams. These include impact investing, informal giving methods, and social giving like GoFundMe campaigns that aren’t technically “charitable.” Giving is changing.  And once again, big givers fueled a lot of generosity. 5% of individual giving came from just 6 individuals and couples, totalling nearly $14B.  If you’d like to read more, here are a few great links to stories unpacking the results from this year’s research:

 
• Full Lilly School Press Released on the 2023 Report
 
• GivingUSA Insights from BWF
 
• AP News Coverage of the Report
 
• 12-minute Report Overview Video from the Alford Group

We will continue to monitor these trends here at ROG and include the research in our content.  This research is crucial as we learn more about how giving is changing. A few years back, GivingUSA changed its model to an annual subscription service, and we recommend that any family office, charitable organization or philanthropist making significant giving choices invest in this research. The Giving Institute, a group of companies and contributors who funds the research, puts out great reports annually, including about changes in the regulatory environment and on special topics like donor-advised funds and generational differences in giving. We think this change is a much better value than a “one and done” report each year.  A changing economy and new giving methods means the research you do on giving choices and reach donors mean more today than ever before. If you’re ready to give and fundraise smarter, contact us today. We’re here to help with the latest data to fuel your impact.