The Chronicle of Philanthropy recently released their annual “How America Gives” report, which analyzes IRS data to track charitable giving. The results of this report are always pretty interesting (we’ve covered them here in past posts), but this year it’s the narrative tied to the findings that has caught a lot of people’s attention.
The headline of the The Chronicle’s report summary says it all: As Wealthy Give Smaller Share of Income to Charity, Middle Class Digs Deeper. That article points to the divergence in giving percentages between the rich and middle-class and lower-income Americans between 2006 and 2012—with those with less actually giving a greater percent of their income.
In today’s post, we’ll explore that topic, and look at some key findings from the “How America Gives” report and what they mean for nonprofits moving forward.
About the “How America Gives” Report
Using IRS data, The Chronicle tracked gifts to charity at the state, county, metropolitan-area, and zip-code levels. The data shows charitable gifts from taxpayers who itemize deductions on their tax forms. It captured $180-billion given to charity in 2012, which is about 80% of the total amount given to charity as tabulated by Giving USA.
6 Notable Statistics on How America Gives to Nonprofits
Here are a handful of interesting findings from the latest How America Gives report:
- 3% is the average amount of their income Americans give to charity (this number has remained the same for decades)
- 4.6% reduction in donations from Americans with an income of $200,000 or more between 2006-2012
- 4.5% increase in donations from Americans who earned less than $100,000 between 2006-2012
- $4.6 billion increase in overall giving amount by Americans earning $200,000 or more in 2012 (for a total of $77.5 billion)
- 14.9% increase in donations from residents of Las Vegas (a city hit hard by the recession) between 2006-2012—the highest increase in the nation
- 36 of the America’s 50 largest cities experienced declines in their rate of giving
Do These Findings Point to a Significant Giving Class Divide?
This question has been the big takeaway from the report (Brian Williams even mentioned this portion of the report on the NBC Nightly News). But at this point it’s a hard question to answer. For one thing, the findings are looking at the period from 2006-2012—one of the most economically tumultuous times in our country’s history.
But even within that time period, the results are surprising. While many wealthy Americans lost their jobs and savings during the recession, so did many middle-class and working-class Americans. So what could be the reason for what we’re seeing in the numbers?
It could be Americans in the middle- and lower-income demographics saw the impact of the recession more and realized the need to help. It’s also been mentioned that increased tax rates on wealthy Americans played a role. Or maybe giving is more valued now by those have less. But it’s nearly impossible to pinpoint the reasoning from these findings alone.
What Do These Shifts in Giving Mean for Fundraisers?
While the “How America Gives” report findings are certainly interesting to read, should they have a significant impact on your nonprofit’s marketing and fundraising efforts? Probably not. But the report results do point to a few notable things you should be looking at within your own fundraising results:
Where are you seeing the best results? In terms of demographics, where are the majority of your donations coming from? The wealthy? Middle class? Lower income? Knowing that information can have an impact on your marketing messaging and fundraising approach.
Are you watching for shifts and trends? When it comes to fundraising, the smallest fluctuations can make a big difference. If your donations drop 1% annually for a specific demographic that can have a big impact. Recognize the shifts (positive and negative) and try to find out why they occurred.
Is your bread-and-butter in size or numbers? When you look at the amount you raise each year, is it most of it coming from big donations or from a large number of small donations? Again, this information can be used to target your efforts, tailor your appeals and structure your ask amounts in the future.
While the “How America Gives” report opens up the conversation to some interesting questions, ultimately what’s more significant to your nonprofit is how America gives to your organization. Make sure you review and analyze your results for insights on a regular basis.