For more on these issues and others surfaced in the Giving USA 2018 report, please join NPQ on Monday, June 18th at 2pm ET for a free webinar in which we’ll discuss the trends in giving over this tumultuous year. NPQ’s Ruth McCambridge will be joined by Patrick Rooney, Professor of Economics and Philanthropic Studies and the Executive Associate Dean for Academic Programs at the Indiana University Lilly Family School of Philanthropy, and Aggie Sweeney, the Chair of Giving USA Foundation and Senior Counsel at Campbell & Company. Click here to register!
Editor’s Note: All the Giving USA figures cited here have been adjusted for inflation.
The Giving USA 2018 report is out and, as expected, annual total giving last year was up by an inflation-adjusted three percent to $410.02 billion—a record, although contributions as a percentage of GDP continued to hover at around two percent. Many factors likely contributed to this, including a rising stock market and an ever-widening wealth gap.
What this means in the long run for most nonprofits is hard to say. Wealthy people generally give in different patterns than the rest of us, but in 2017, every nonprofit category saw significant increases except for international affairs, which fell 6.4 percent, and religion, which rose only 0.7 percent. Still, in our estimation, the surface numbers may hide a longer-term problem: More and more dollar donors are flowing into repositories like foundations and donor-advised funds, where some or all of it will be held for an extended period of time before it gets to a working nonprofit.
Part of this is due to the growth of high dollar and mega-gift givers. The report reveals that:
- For 2016, Giving USA added $1.495 billion in mega-gifts made by individuals and $400 million in mega-gifts made by bequest.
- For 2017, Giving USA added $4.1 billion in mega-gifts made by individuals and $850 million in mega-gifts made by bequest.
It should be mentioned that the floor above which a gift is defined as a mega-gift changes year over year. In 2016, it took $200 million to qualify as a mega-gift; in 2017, that number jumped to $300 million—thus narrowing the range—and still the value of mega-gifts more than doubled. The names of many of those donors are familiar: Mark Zuckerberg and Priscilla Chan gave a cool $1.9 billion to the Chan Zuckerberg Foundation; Florence Irving gave $600 million to Columbia University; Michael Dell gave a billion to his foundation; and Henry Hillman’s estate donated $800 million to the eponymous family foundation in Pittsburgh. Many of these gifts, again, are currently parked at intermediaries. The Chronicle of Philanthropy estimates that mega-gift category differently, for a total of $10.3 billion. Still, whichever numbers you accept, the dollar amount has more than doubled. Giving to foundations is up by 13.1 percent, too.
At the same time, corporate giving has apparently increased by eight percent, though as a proportion of pretax profits—which are, themselves, are at near-record levels—it is nowhere its peak. In 1986, this ratio was at two percent, but now it is less than half that, even though profits have grown almost tenfold.
Corporate giving as a percentage of pre-tax corporate profits, 1977-2017
(in billions of current dollars)
|Year||Corporate giving||Corporate pre-tax profits||Corporate giving as percentage of pre-tax profits|