Charitable Giving Climate Continues to Decline, Nonprofits Say

INDIANAPOLIS, August 3, 2009 — The fundraising climate for U.S. charities continued to decline in the first half of 2009, according to the latest Philanthropic Giving Index (PGI) released today by the Center on Philanthropy at Indiana University.

The PGI, similar to a Consumer Confidence Index for charitable giving, includes three indexes on a scale from 0 to 100, based on a semiannual national survey of nonprofit fundraising professionals. Higher scores indicate more positive or optimistic attitudes about the climate for fundraising.

The fundraisers’ assessment of the current giving environment fell to its lowest level since the center began the study in 1998.

In the latest survey, the Present Situation Index (PSI) is at 58.0, an 8.7 percent decrease from six months ago and a 28.9 percent decrease from one year ago. The PSI has averaged 82.1 over the history of the study.

Fundraisers’ expectations for the coming six months are slightly more optimistic, but remain below the historical average for the study. The Expectations Index (EI) is at 72.8, a 10.2 percent increase from six months ago and a 13.2 percent decrease from a year ago. The overall PGI, which is an average of the current and future indexes, is at 65.4, up 0.9 percent from December 2008 and down 21 percent from this time last year.

“The steep decline in confidence in current fundraising conditions confirms that nonprofits are still encountering difficult times and anticipate that they may be facing more ahead,” said Patrick M. Rooney, executive director of the Center on Philanthropy. “There is an interesting dichotomy between the decrease in the fundraisers’ perceptions of the present situation and the increase in their expectations for the future. This is likley a reflection of continued uncertainty about where the economy may be headed.”

Consultants who provide outside fundraising counsel to nonprofits are substantially less optimistic about the current fundraising climate (PSI of 49.0) than other survey respondents. Fundraisers for arts, culture, and humanities organizations and human services nonprofits also are less confident about the current conditions for giving than other types of nonprofits. Development officers from educational and religious organizations were the most optimistic about the present climate.
Expectations for improvement in the fundraising climate in the next six months are highest among religious, education and health organizations, and consultants. Public society benefit, environment/animal and international organizations, arts groups and human services organizations have the lowest expectations for the immediate future.