Study Predicts Strong Growth in US Charitable Giving

In the new Trump presidency era, charitable giving in the US is predicted to grow by 3.6 per cent in 2017 and by an additional 3.8 per cent in 2018, according to a new report by the Indiana University Lilly Family School of Philanthropy.

In particular the report predicts that health and education will see the highest increases, well  above the 10-year average.

The report, The Philanthropy Outlook 2017 and 2018, is presented by global fundraising consultancy Marts & Lundy.

“Continued growth in the overall economy will lead to a rise in philanthropic giving this year and next,” Amir Pasic from Indiana University said.

“Our research indicates that all types of donors – individuals, foundations, corporations and estate –  are likely to increase their giving in each of the next two years. Non-profit organisations and the people they serve can find encouragement in the anticipated expansion of giving.”

Total giving

Changes in total giving for the years 2017 and 2018 are predicted to exceed the most recent 10-year annualised average increase in giving of 0.5 per cent, but will be below the most recent 25-year and 40-year annualised averages.

In general, increases in the US economy, as reflected in the value of stocks, gross domestic product and household income, will lead to a rise in philanthropic giving in 2017 and 2018.

“The projections of The Philanthropy Outlook point to some dramatic changes in American philanthropy. Contributions to donor-advised funds and to family foundations continue to grow significantly, leaving enormous amounts of charitable dollars waiting for future distribution,” Marts & Lundy chair John Cash said.

“These donors are seeking meaningful relationships with organisations and the kinds of inspirational ideas that will fulfill their philanthropic aspirations. While the outlook is certainly good, the need for vigorous and meaningful engagement on the part of recipient organisations has never been greater.”

Projected growth by type of donor:

• Growth in giving by foundations will lead the way in both years (5.9 per cent in 2017 and and 6.0 per cent in 2018).
• Estate giving is expected to increase by 5.4 per cent this year and 5.2 per cent next year.
• Giving by individuals is predicted to grow 3.0 per cent and 3.2 per cent respectively.
• Giving by corporations will lag behind the other sources of giving, rising by just 2.4 per cent

           and 2.7 per cent respectively.

“As we consider the outlook for 2017 and 2018, it’s important to note that individuals continue to play a leading role in driving both giving trends and growth in giving,” director of research for the Lilly Family School of Philanthropy Una Osili said.

“Individual donors are responsible for the majority of charitable giving, as well as the increase in foundations, donor advised funds and other innovations in giving.”

Health

Giving to health is predicted to grow by 8.5 per cent in 2017 and 7.9 per cent in 2018, exceeding historical annualised averages over the most recent 40-year period. The report said the anticipated increases across various consumer spending categories and an overall positive increase in the US economy will influence the rise in giving to health.

Education

Giving to education is projected to rise 6.3 per cent in 2017 and 6.0 per cent in 2018, continuing the strong growth trends realised in recent years. Giving to education includes giving to support education at all levels, including higher education, libraries, educational research, educational support services and many similar types of organisations. Multi-million dollar gifts and billion-dollar campaigns across public and private universities have positively influenced growth in this sub-sector in recent years.

“The increase in philanthropic support across the entire sector provides organisations with the opportunity to increase services in a time of expanding need,” president and CEO of Marts & Lundy Phil Hills said.

“For education and health, which will see the highest growth, access and innovation will likely be significant issues to address. Student debt, rising costs of patient care and the need to continue funding for life-changing research will continue to be focal points for giving.”

Public-society benefit

The report said giving to support the public-society benefit subsector would also be strong, with growth of 5.2 per cent and 5.4 per cent, respectively. Giving to public-society benefit includes giving to federated campaigns, United Ways, human and civil rights organisations, national donor-advised funds, and other similar types of organisations. It said growth in contributions to donor-advised funds will likely help this subsector realise sustained increases.

In 2016 Australia’s biggest philanthropists favoured universities, donating record-breaking amounts towards all aspects of tertiary education and university life.

Figures obtained by Pro Bono News showed that the biggest philanthropic gifts in 2016 delivered major Australian universities a share in more than $269 million – more than double the estimated $117 million donated to universities in 2015.

The top annual donation came from philanthropists Graham and Louise Tuckwell to The Australian National University after donating $200 million in the country’s largest ever personal philanthropic contribution to a university.