NCPA - National Center for Policy Analysis


June 10, 2010

Faced with continued economic uncertainty, Americans cut back on their charitable giving again last year, says the Wall Street Journal. 

For the second year in a row, philanthropy has seen the deepest decline ever recorded by the Giving USA Foundation, which has tracked annual giving since 1956: 

  • Donations fell 3.6 percent to $303.75 billion last year, down from $315 billion in 2008, according to the latest Giving USA study, released Wednesday; in 2008, they were down 2 percent.
  • Giving, in current dollars, has gone up every year the organization has measured it except 1987 and the past two years.  

Whatever their wealth, people need to feel it is secure, and until they regain confidence in the economy, giving is likely to stay down.  As a measure of gross domestic product (GDP), the nation's output of goods and services, giving in the United States is still historically strong, says the Journal: 

  • Charitable gifts were equivalent to 2.1 percent of GDP last year, compared with 2.2 percent in 2008.
  • Giving has historically hovered at around 2 percent of GDP. 

Still, giving fell across most sectors last year, says the Journal: 

  • Giving to religious organizations, which account for more than a third of total donations (the largest share) dropped by about 1 percent in current dollars.
  • Giving to education dropped by 3.6 percent.
  • Giving to the arts, culture and humanities dropped by 2.4 percent.
  • Giving to human services and health organizations rose by 2.3 percent and 3.8 percent, respectively.  

Individuals may be changing the way they give, says the Journal: 

  • Contributions to foundations fell 8 percent in 2009, following an almost 20 percent drop the year before.
  • With some foundation assets declining as much as 30 percent due to the recent stock market rout, grantmaking fell by almost a tenth last year, according to the Foundation Center, a nonprofit group of foundations. 

Source: Shelly Banjo, "Donations Slip Amid Anxiety," Wall Street Journal, June 9, 2010. 

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