ARTICLE
Is The Generosity Decline Real? What To Do!
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PART 1
Are Americans Become Less Generous? What the Latest Research Tells Us. This piece by Roger Craver of The Agitator-DonorVoice is sobering, to be sure. It’s based on the recently released Generosity Commission Report. There hasn’t been such a broad-based report in the social benefit sector since 1975! And the news is not good.
Philanthropy has been shrinking
Here are the facts:
- There is still money coming in, but many fewer people are giving it. In fact, fewer than half of U.S. households now donate to charitable causes, a sharp decline from 65% in 2008. 43% of donations in 2020 came from gifts of more than $50,000. [Which is why major gifts programs have become so important to organizations’ survival].
- The trend of less donors was accelerated by the pandemic. While there were short-term spikes in giving in response to urgent needs, these have not turned into long-term trends. [Which is why robust donor retention programs have become more important than ever].
- Lower-income and less-educated households are giving less. This is a change from historical trends that saw these groups among the most charitable, particularly through religious groups. The fact that religious affiliation has declined may be contributing to this trend. [The shrinking pool of givers has led to concerns about a dearth of donor diversity.]
- Younger generations, particularly Millennials, are donating at lower rates than their parents and grandparents did at the same life stage. They show a preference for non-traditional giving methods, such as direct support through crowdfunding (e.g., GoFundMe) or political contributions, rather than through established nonprofits. [Which is why growing multi-channel giving, particularly digital, is increasingly important.]
- Volunteerism has declined over the past several decades. The rate of volunteerism, as measured by the Current Population Survey of the U.S. Census Bureau and the U.S. Bureau of Labor Statistics, reached a 15-year low of 24.9% in 2015. More than a quarter of people involved in volunteering before the pandemic ceased to volunteer during the pandemic – and they haven’t returned. [Which is why building volunteer opportunities is something fundraisers need to advocate for.
- Tax incentive reductions have led to fewer taxpayers making itemized charitable contributions. The Tax Cuts and Jobs Act (TCJA), passed in December 2017, included several provisions, most notably a doubling of the standard deduction. After the TCJA’s passage, the proportion of households claiming a charitable deduction on their federal income tax returns fell from 25% in 2017 to 10% in 2018 (and then to 9% in 2019). The decline was especially pronounced among upper-middle-income households. [Which is why organizations must now double down on promoting emotional cases for support that awaken the heart.]
The news is not all bad though, especially if you consider the power of philanthropy to not only solve shared problems, but to also give those engaged in giving and volunteering connectedness, purpose and joy.
Your mission, should you choose to accept it, is to help facilitate philanthropy.
Whatever the heck is going on, this much is true: Your future is in YOUR hands
Simply wringing your hands about things outside your control is useless.
- You can’t stop the world from changing.
- You can’t control the economy, rates of home ownership, the affordability of childcare and education, or increasing rates of consternation around global issues like climate change, war, threats to democracy, viral disease, or the advent of artificial intelligence.
- You can’t control religious affiliation.
- You can’t control tax policy as an external incentive for giving.
- You can’t control what services the government provides, or does not provide.
Paying attention to things you can control is smart.
- You can stop to understand the impact of all these things on your potential donor base — and on the folks these donors could help through their philanthropy.
- You can dialogue with your constituents to learn more about their interests, preferences and outlook on the world – in order to make an informed, strategic values-to-values match.
- You can use this dialogue and understanding to inform, and reframe, your approach to fundraising and marketing – striving to become and stay relevant.
- You can, whatever you’ve done in the past, take some time to regroup and think about what may work best for the future.
Needed more than ever: 3 ways to culture shift
One of the reasons people keep doing what they’ve done before – even though it’s not working as well as it did – is status quo culture. And, to paraphrase famed management guru Peter Drucker, “culture eats strategy for breakfast.” No matter how detailed and solid your strategy is, if the people executing it don’t nurture the appropriate culture, your projects will fail. The human factor matters.
For far too long, fundraising has been about taking (“hitting people up,” “twisting their arm,” asking the board to “give ‘til it hurts.”), not giving. It has focused on money, not outcome. Not love. Not the joy that comes from giving.
1. Instead of focusing on what would-be donors can do for you, focus on what you can do for them
I was recently exposed to the philosophy of Ikigai. The word translates, more or less, to “life purpose.” The book Ikigai: The Japanese Secret to a Long and Happy Life shows how when people find meaning, they find joy. To me, it’s not that different from the writings of Victor Frankl, the Holocaust survivor who wrote about the quest for meaning being essential sustenance for those who survived.
TRUTH: You may be complicit in the generosity decline if you’re not actively being generous with your donors. Part of your job is to help them find the meaning they seek. And this can be as simple as holding fast to the Golden Rule – a simple concept, central to most religious faiths, yet too often not consciously practiced by nonprofits when dealing with donors. From wherever you derive your inspiration, think more about the quest for meaning in your work with supporters.
2. Instead of focusing on selling, focus on helping
Pick up a copy of Jay Baer’s excellent book, Youtility, about marketing that cuts through the clutter via help, not hype. Think about the myriad of things you can give to your supporters to make their lives better. This should be a central part of your social benefit sector mission.
TRUTH: You may be complicit in the generosity decline if you aren’t including donor needs in your mission. The more you focus on helping, the more others will want to help you – and you’ll feel better too, which means positive energy all around.
3. Instead of focusing just on yourself, focus on supporting other nonprofits too
As the saying goes, “a rising tide raises all boats.” Don’t see yourself in competition for resources. You and your colleagues in the sector are comrades. You’re on the same team! If someone isn’t excited by your mission, but you discern a passion for something one of your contemporaries does, by all means make an introduction. Hopefully they’ll do the same for you as the occasion arises.
TRUTH: When you stop stressing what sets your organization apart from others, and think more about what connects you, you’ll contribute to a culture of abundance. Work together! Create community. It’s something else, in addition to meaning, most all human beings seek. And it’s the only way we’re going to boost philanthropy overall – and solve today’s most pressing problems.
In Part 2 of overcoming the generosity decline, we’ll get specific with concrete strategies you can use to speak to the needs of today’s and tomorrow’s constituencies – while also meeting your own.
How to Write a Fundraising Plan in 2 Steps!
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