The Outlook for Giving
Chapter Leadership Brief 7.03.2020
By Steve Jacobson, AFP-NYC President and CEO, JCA, Inc.
Like some of you out there, I am a self-professed data nerd. Whether it’s poring over the box score of a baseball game (Major League players reported for “spring” training this week!) or studying the details of unemployment reports, I’m on it. So, when the Giving Institute recently released its “Giving USA: The Annual Report on Philanthropy,” that analyzes charitable giving for 2019, I couldn’t resist delving into the numbers.
You may be asking what the relevance of giving is in 2019, given that the world in 2020 is a totally different place than what it was just a few months ago. After all, the unemployment rate was a paltry 3.5% at the end of 2019 versus just over 11% in June. And the stock market was cruising along in 2019, having risen over 28% during the year. And now? The S&P 500 has lost over 8% of its value in the last six months. Yes, by most financial and economic measures, we are in a very different place.
But the key for me is that we can look at all of these economic and financial measures from 2019 and see that, in general, Americans got richer. And the top 1% got a lot richer. But that didn’t really translate into commensurate gains in 2019 giving. As Giving USA points out, total charitable contributions in 2019 vs. 2018 only increased 2.4% after adjustment for inflation, significantly less than the average increase that Giving USA has measured since their study’s inception in 1979.
So, if we didn’t see large gains in philanthropy in a real boom year, what are we likely to see in 2020, the year of the coronavirus pandemic?
The answer, I’m afraid, is really scary. While there has been a relative outpouring of support from donor advised funds, those disbursements represent gifts that were already counted in past years’ giving totals. To date, we’ve seen giving shift dramatically to health and food security and away from the environment, education and the arts. And, excluding disbursements from DAFs, many organizations have been informally reporting that giving is down significantly this year versus the first half of last year. It’s a really strong possibility that this weakness will continue throughout the year, and ultimately result in a significantly negative impact on critical year-end giving.
This doesn’t mean that, as fundraisers in this fight, you should throw in the towel. On the contrary, now is the time to work harder and smarter. And, that’s where we, the NYC chapter, can help. Our industry-leading educational content that we present at Fundraising Day in New York, has been packaged up for your online consumption. Over 40 sessions across 11 fundraising disciplines, including Fundraising Essentials, Corporate and Foundation Giving, Research and Major Gifts, are there to help you succeed in this challenging environment. Please visit www.frdny.org for more information and to gain access. Be sure to use the special chapter code “AFPM” to receive your member pricing.
Have a great 4th of July and be sure to stay safe!