The annual release of the Giving USA report always offers interesting insights into who is giving and what they are giving to each year. While the effects of the new tax legislation didn’t take effect until 2018, the 2017 report offers some glimpses into how donors are responding.
Total Giving Grows—Will it Continue?
The good news from the top line is that total giving totaled $410 billion, topping $400 billion for the first time. As usual, this growth mirrored overall growth in the economy, and hovered around 2 percent of GDP.
In years past, it has been pretty easy to estimate total giving as a percentage of GDP, but this will be a key number to watch in next year’s report. If donors chose to give their 2018 gifts at the end of 2017 to ensure deductibility, or if they forgo giving altogether because they won’t experience a tax benefit, growth in giving may fall off pace with total economic growth.
Mega-Gifts Continue to Pace Giving
Despite raising the amount required to qualify as a “mega-gift” from $200 million to $300 million, these gifts still grew from $1.495 billion in 2016 to $4.1 billion in 2017. Even more telling is that just under $3 billion of that figure came from two households donating to their foundations—Michael Dell and Mark Zuckerberg/Priscilla Chan.
Although the definition of a mega-donor likely differs for your constituency, this underscores the importance of relationship building and engagement with those who are able to make the top-level gifts to your organization.
Growth Across the Board, but Signs of Changes on the Horizon
With the exception of international affairs, every sector saw growth in 2017. Religion remains the largest sector at 31 percent of gifts, but donations to foundations saw the largest growth at 15.5 percent (up to 11 percent of total giving). And as giving to foundations continues to grow, likely spurred by tax-incentives, giving from foundations will continue to increase at a higher pace. This will provide some protection from slow economic cycles, but also keeps a large amount of assets, that could otherwise be put to use by nonprofits, in holding.
The second and third fastest growing sectors were the arts and public society benefit organizations at 8.7 and 7.8 percent respectively. It’s possible growth in these areas was driven by the political climate—donors giving to the arts where public funds are being withheld, as well as the rage giving phenomenon fueling public society benefit organizations. This group also includes donor-advised funds, so chances are good it will show strong growth again for 2018.
More information on the Giving USA 2018 report can be found here.
Giving USA 2018: The Annual Report on Philanthropy for the Year 2017. Researched and written by Indiana University Lilly Family School of Philanthropy. Sponsored by Giving USA Foundation, a public service initiative of The Giving Institute. © 2018 Giving USA Foundation™
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