For 20 years, experts have sounded the alarm on a decline of charitable giving in the United States. Then came the pandemic, which led to a wave of new donations and volunteers to nonprofits. For some leaders, this was a sign that perhaps the retreat from philanthropy was reversing course.
But it’s clear now, according to a substantial new report released by a group of nearly 200 philanthropic leaders, that COVID-19 did not bring about any lasting reversal of declining charitable giving — and many of the trends identified in the 2010s have since accelerated.
Today, the number of donors to and volunteers with nonprofit organizations continues to decline, even though the total amount of money has gone up. In other words, more money is being given, but by fewer people.
These are some of the takeaways from the report, authored by a group called the Generosity Commission. Over the past three years, the commission funded more than $2 million in research to understand the state of giving and volunteering in America.
It should be said that this project wasn’t led by disinterested parties. The Generosity Commission wants to figure out how to increase giving and volunteering to the more than 1.7 million nonprofit organizations across the United States, 88 percent of which have budgets less than $500,000.
The report’s findings highlight some of the debates that have been mounting in philanthropy over the last decade: Why does giving and volunteering matter? What constitutes generosity and can it really be measured? Why is nonprofit participation declining?
We’re facing something of a Rorschach test right now: Recently, the New York Times published a sobering article on the threat posed by declining volunteer paramedics. Yet it could reasonably be said that in a country as wealthy as the U.S., we shouldn’t depend on volunteer labor to fill these jobs, and indeed, most other nations don’t.
Even for the organizations with ample funding, donations increasingly come from a concentrated pool of wealthy donors. Perhaps it seems intuitive that people who make less money would be less likely to donate or volunteer. But research has shown that, at least historically, it’s the poor who donate more of their incomes to charity. The Generosity Commission suggests that while economic insecurity is part of the story, cultural shifts and changes in habit formation are likely at play, too.
Other explanations include declining trust in institutions, broader social disconnection and changing tax incentives. Some experts argue that a focus on courting high-dollar donors has sidelined smaller contributions, fueling a negative cycle in giving.
To change the culture, the report recommends enlisting more public figures and leaders to talk about how they benefit from giving and volunteering, and to include young people and employers in the conversation. They also recommend that philanthropies issue marketing and development grants to nonprofits, mutual aid networks and giving circles.
The debate over the definition of generosity notwithstanding, one thing is clear: nonprofits increasingly depend on a limited number of rich benefactors. And ceding a sense of empowerment to improve the world to the ultra-wealthy is what keeps Jane Wales, the commission co-chair and vice president of Philanthropy and Society at the Aspen Institute up at night.
“People ask: ‘Why does participation matter if there’s enough money to go around to nonprofits, why does it matter if it’s concentrated in the hands of just a few people?’ ” she told me. “And from my own perspective, it’s got everything to do with the health of our society. The last thing you want is large portions of American society to feel they lack agency and are not part of the everyday decision-making in their own community.”
Rachel Cohen is a senior policy reporter at Vox.com who focuses on U.S. social policy.
