GivingUSA: Charitable Giving Breaks Record to Reach $471B in 2020
GivingUSA 2021: The Annual Report of Philanthropy for the Year 2020 has just been released, and Americans set a record for giving in a year of unprecedented events and challenges. Total giving is grew to $471.44 billion, rising by 5.1%, and after adjustment for inflation, 3.8%.
GivingUSA is the longest-running report on charitable giving, published by Giving USA Foundation, a public service initiative of The Giving Institute. It is researched and written by the Indiana University Lilly Family School of Philanthropy at IUPUI. RNL is proud to be a member of the Institute and to co-sponsor the research.
Giving rises to meet crucial needs, but an uneven picture for charities
“Unprecedented developments in 2020 including the global pandemic, the ensuing economic crisis, and efforts to advance racial justice created intense, widespread need and significantly increased the demand upon nonprofit organizations. Remarkably, generous giving coupled with the stock market turnaround in the final months of the year boosted contributions. As a result, 2020 is the highest year of charitable giving on record,” said Laura MacDonald, CFRE, chair of Giving USA Foundation and Principal and Founder of Benefactor Group.
Americans saw incredible need from the pandemic and responded. We were inspired by massive giving as the global pandemic hit in support of student and campus emergency funds, along with record giving days and special appeals throughout the year.
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Key takeaways from GivingUSA 2020: the charities that gained the most in a challenging year.
Here are some key points from GivingUSA and other research this year:
- Giving is up, and the stock market mattered: A key question that fundraisers have been asking is whether giving would decline as it did in the Great Recession. While the urgency of need brought by the pandemic was unprecedented, the economic fundamentals are different. The year-end stock rally seemed to make a difference. Despite a decline in GDP, many givers had both strong motivation from pandemic needs and the racial justice movement to give, and the resources to make a difference. The pandemic’s effects have been felt unevenly by Americans, and it’s great to see that individuals with the ability to give stepped up, contributing $324B. This increase of 2.2% in individual giving is remarkable, but still a decrease in momentum from the rise of 6.7% in 2019.
- Public-society benefit saw the largest increase: fueled by pandemic needs, giving in this area rose by 15.7%, the largest increase in any sector.
- Education giving grew by 9%: The total increase in education giving over the past two years is 21.2% and this total includes higher education giving. CASE reported earlier this year that for the fiscal year of 2020 (basically through half of the 2020 year), higher education giving had a small increase, so end of calendar year giving likely propelled much of this. Higher education giving results are mixed, but according to CASE, 48% of institutions still raised more by the end of the FY20 fiscal year.
- Foundation and bequest giving is up, corporations gave less and the arts took big hit: Corporate giving declined substantially while both foundation and bequest giving increased. Giving to the arts, culture and humanities declined 7.5%, and the impact to in-person events is still being felt.
Fundraising innovation matters in a challenging time
“Nonprofit leaders and fundraising professionals played a role with significant innovation in fundraising methods and donor outreach in order to raise greater financial support under difficult circumstances,” said Una Osili, Ph.D., associate dean for research and international programs at the Lilly School of Philanthropy.
This boost in giving also comes with a “wide range of informal philanthropic responses,” including person-to-person giving. As fundraisers, we should be watching these connected, social and friction-free giving methods (GoFundMe, I mean you), and incorporating key components of them into our strategy.
Here’s what I think the GivingUSA report means for fundraisers: Americans have once again stepped up in a crucial time, and they gave where the need was immediate. So, providing donors with evidence of impact for giving really matters. Encouraging donors to give socially, and incorporating easy, online giving methods into every appeal also really makes a difference. Many of us had direct mail disrupted when the pandemic hit, a reminder that an easy online component is key. Key higher education giving methods that harness this potential, like crowdfunding and giving days, are rising in importance. And tech-enabled personal outreach, that makes giving part of a lifestyle rather than just a transaction, will sustain donors in a challenging time.
We know that an overall increase in giving doesn’t mean your organization did better last year. In fact, if you’re behind on technology, doing things the ‘way they’ve always been done,’ or pulled back on outreach last year, you probably have some ground to make up. Drop us a line and we can discuss your goals, and share new strategies that can make a difference, right away.
You can read full insights from GivingUSA and the press coverage of the release, and order the full publication package with GivingUSA subscription. The materials can be helpful in presentations with your fundraising team, key stakeholders, and even donors.