Does Charitable Giving Correlate with Consumer Confidence?

According to the recently published annual report from the Giving USA Foundation and the Indiana University Lilly Family School of Philanthropy, individual charitable giving in the United States grew almost 4% last year, while corporate donations increased at triple that rate. Giving historically tends to follow the economy and consumer confidence.

“In 2012, Americans were feeling better – but not great,” Gregg Carlson, chair of the foundation, wrote in the study. But he said even the small increase in giving showed the “healing continues, with the prognosis being good.”

Here are some details from the report:

  • Overall, U.S. donations to bolster the arts, health, religion and other activities totaled $316.2 billion in 2012, a 3.5% increase from the $305.5 billion donated in 2011. Donations are still down about 8% from their 2007 peak of $344.5 billion, after which giving levels fell sharply during the recession.
  • Individuals in the United States donated $228.9 billion last year, a 3.9% increase from $220.3 billion in 2011. In contrast, companies and their foundations increased their giving by 12.2% to nearly $18.2 billion in 2012, compared with $16.2 billion the year before. Giving by charitable foundations, up 4.4%, added another $45.7 billion in 2012, and bequeathed gifts fell 7% to $23.4 billion last year.

In other research, The Chronicle of Philanthropy reports that online donations to U.S. nonprofit groups are growing much faster than other types of gifts. The organization found that online donations in 2012 grew to $2.1 billion, a 14% increase over last year.

Nearly three-quarters of the groups surveyed by The Chronicle of Philanthropy had a goal for online donations to account for more than 10% of their future fundraising efforts. Roughly a fifth expected Internet gifts to account for 20% of their overall donations.

Interestingly, the Chronicle study found that many nonprofits were increasing their online revenue by persuading people to make gifts monthly, quarterly or over another set period.

With online giving increasing in popularity, giving sites that aggregate charities have taken off. For example, Causes allows you to search for a charity that interests you and makes it easy to set up your own personal fundraising campaign and invite your friends to join in.

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