The news is good. Very good.

While it’s hard to believe a statement like that — coming off a year and a half marked by an unprecedented-in-our-lifetime health crisis, political and economic turmoil, and a global movement around racial and social justice — it’s true when it comes to overall charitable giving.

During Lighthouse Counsel’s virtual Giving USA 2021 Briefing, Dr. Una Osili, associate dean for research and international programs at the Indiana University Lilly Family School of Philanthropy, and Dr. Anna Pruitt, managing editor of Giving USA at the school, shared the top findings from Giving USA 2021. The report —  the longest and most comprehensive report on charitable giving — was published by the Giving USA Foundation, a public service initiative of The Giving Institute, of which Lighthouse Counsel is a proud member firm. Results of the 2021 report were released in June. 

The report’s top-line finding is that overall charitable giving in the United States reached an all-time high of $471.44 billion in 2020. 

The biggest slice of the pie was individual giving, at 69% ($324.10 billion) of all American philanthropy. Foundations came next, at 19% ($88.5 billion), followed by bequests, at 9% ($41.91 billion), and corporate giving, at 4% ($16.88 billion).

Not only did these various sectors show a marked increase in giving, but some experienced changes in how they gave. Foundations, for example, leaned more toward unrestricted support for nonprofits, as well as more-flexible forms of giving and increased attention to grassroots and community-based organizations. Corporations expanded workplace giving programs and also focused more on community grants to help with COVID response and issues around racial equity and social justice. 

“This was not possible without the hard work of many nonprofits around the country,” Osili shared. “There are more than 1.3 million nonprofits of all different types in the United States, and throughout 2020, many nonprofits showed resilience and innovation not just in fundraising but in pivoting to meet the needs of communities.”

Where did all that money go? The report showed that religious congregations got the biggest slice of the pie, followed by education and then human service nonprofits.

Top findings

Osili and Pruitt outlined the following top eight findings of the Giving USA report:

1. At $471.44 billion, overall giving in the U.S. reached a new record in 2020, exemplifying a remarkable expansion in generosity. 
2. The economic, social and political environment of 2020 created an unprecedented landscape around the world that had a huge impact on giving.
3. Foundation, individual and bequest giving grew in 2020, while corporate giving shrank (due mainly to the economic impact of the pandemic on businesses).
4. Giving to religion, education, human services, public-society benefit, international affairs, environment increased, along with giving to foundations, whereas giving to health-related and arts/culturally related organizations decreased. 
5. With organizations forced to pivot away from more-traditional fundraising models, especially events, 2020 saw unprecedented innovation in fundraising opportunities, such as crowdfunding, where many organizations experienced an influx of new donors.
6. The rapid growth in giving to human services continues a pattern seen in previous recessionary years, as well as in years when the United States experienced a crisis.
7. Giving to the arts, culture and humanities declined, mainly because a majority of venues were forced to close because of the pandemic. and possibly because donors considered these to be non-essential missions.
8. Online giving accounted for a growing share of giving — 13% of all giving in 2020, compared with 87% of all other giving avenues combined. That’s up from a low of 6.4% in 2013, with steady increases year over year to 8.7% in 2019.

What now?

Osili and Pruitt pointed out that the uptick in giving could in no small part have to do with the fact that with society basically shut down for the bulk of 2020 because of the pandemic: Many families and individuals had more disposable income at hand because they weren’t spending on work commutes and meals, outside entertainment, dining and travel, and the like. But as society continues to reopen, what will happen to that extra cash once people resume their regular work, school and entertainment routines?

Historically, giving in the United States as a fraction of the overall economy remains fairly consistent, at roughly 2%. The unprecedented landscape that grew from the pandemic, the global reckoning around social justice, and political upheaval and economic turmoil ticked giving up to around 2.3% in 2020. 

The challenge for nonprofits now, Osili and Pruitt said, is maintaining that higher percentage or continuing the upswing — keeping Americans giving not just in a time of crisis but also in the recovery period that we’re in now and beyond.

“I want to encourage all of us to think about how we can step up not just in terms of our own personal giving,” Osili said, “but also in the work that we do in philanthropy to encourage continued growth and continued expansion in generosity beyond 2020.”

To view the video of this special briefing, sponsored by Lighthouse Counsel in the spirit of philanthropy, go to tinyurl.com/GivingUSA2021.