Giving USA: Donations Drop Below $500B in 2022 After Record-Setting Year

Decreased giving is typically associated with difficult or unusual economic circumstances and has only happened three times in the past 40 years. That description, unfortunately, fits 2022, which has become the fourth year to see a dip in giving, according to “Giving USA 2023: The Annual Report on Philanthropy for the Year 2022,” a report created by the Indiana University Lilly Family School of Philanthropy and published by the Giving USA Foundation. 

The annual report, released today, showed that in 2022 nonprofits raised $499.33 billion — a 3.4% year-over-year drop in current dollars and a 10.5% downturn when adjusted for inflation. The slide comes on the heels of record-setting U.S. giving trends in 2021, with $516.65 billion being donated to nonprofits. In dollars, the 2022 slump calculates to $17.32 billion in fewer funds nonprofits received to carry out their missions last year.

Here’s a look at the findings, broken down by source and mission. 

Giving by Source

The loss can be attributed to the 6.4% decline in donations in current dollars from individual donors, as well as a 40-year high 8% inflation rate. Individual giving continues to make up a smaller percentage of total giving, dropping to 64% in 2022. While individual giving total dollars weakened as well, foundations, bequests and corporations all saw increases in current dollars. 

However, when adjusting for record inflation, all categories decreased, with individual donations leading the way with a 13.4% loss.

• Total giving. $499.33 billion
  • Down 3.4%, or down 10.5% when adjusted for inflation.
• Individuals. $319.04 billion 
  • 64% of total giving.
  • Down 6.4%, or down 13.4% when adjusted for inflation.
• Foundations. $105.21 billion 
  • 21% of total giving.
  • Up 2.5%, or down 5% when adjusted for inflation.
• Bequests. $45.6 billion 
  • 9% of total giving.
  • Up 2.3% from 2021 in current dollars, or down 5.3% when adjusted for inflation.
• Corporations. $29.48 billion
  • 6% of total giving.
  • Up 3.4%, or down 4.2% when adjusted for inflation.

Giving by Mission

When broken down by mission, many nonprofits received more donations, but not at the same pace as inflation. Only two types — foundations and international affairs — were able to outpace inflation. Religious, health, as well as arts, culture and humanities causes also saw growth in current dollars, though not when adjusted for inflation. Meanwhile, public-society benefit causes saw the largest decline at 8.4% in current dollars.

• Religion. $143.57 billion
  • Up 5.2%, or down 2.6% when adjusted for inflation.
• Human services. $71.98 billion
  • Down 0.6%, or down 8% when adjusted for inflation.
• Education. $70.07 billion
  • Down 3.6%, down 10.7% when adjusted for inflation.
• Foundations. $56.84 billion
  • Up 10.1%, or up 1.9% when adjusted for inflation.
• Health. $51.08 billion
  • Up 5.1%, or down 2.6% when adjusted for inflation.
• Public-society benefit. $46.86 billion
  • Down 8.4%, or down 15.2% when adjusted for inflation.
• International affairs. $33.71 billion
  • Up 10.9%, or up 2.7% when adjusted for inflation.
• Arts, culture, and humanities. $24.67 billion
  • Up 2.9%, or down 4.7% when adjusted for inflation.
• Environment and animals. $16.1 billion
  • Down 1.6%, or down 4.2% when adjusted for inflation.

The Silver Lining

A year ago, Giving USA placed 2021 giving at $484.85, which meant giving grew over 2020’s figure, but growth flattened when accounting for inflation. Those figures are often updated as more information is uncovered, so 2021’s figure was, in fact, $516.65 — nearly 4% higher than previously reported. That means that 2021 had growth regardless whether it’s viewed  through current dollars or figures adjusted for inflation.

Additionally, that means giving surpassed $500 billion for the first time ever last year, a feat still worth recognizing despite unfavorable economic elements suppressing donations in 2022. 

“Drops in the stock market and high inflation caused many households to make tough decisions about their charitable giving for the year,” said Josh Birkholz, chair of Giving USA Foundation and CEO of BWF. “But despite uncertain economic times, Americans demonstrated how essential they view the nonprofit sector and its ability to solve big problems — by still giving nearly half a trillion dollars in 2022.”

The Impact of the Economy on Individual Donors

Though Americans had $25 million less in disposable income in 2022, their charitable donations were also $21.93 million less, according to Giving USA’s analysis of U.S. Department of Commerce data. 

The economy likely played an oversized role. The S&P 500 fell 19.4% (or 25.4% when adjusted for inflation) — the first double-digit decrease since the Great Recession. As with the Fundraising Effectiveness Project’s 2022 results, Giving USA noted a reduction in giving among high-net-worth individuals in the fourth quarter, a time typically reserved for a large portion of the year’s giving that also correlated with the steepest stock market declines in 2022. Despite wealthy Americans pulling back, major gifts remained 5% of total individual giving.

Despite the negative outcomes, Una Osili, Ph.D., associate dean for research and international programs at the Lilly Family School of Philanthropy, noted the economic bright spots included a strong labor market and 9% growth in GDP.

“The economic picture that emerges suggests that many households were stable — we did not see job losses or an increase in unemployment the way we did in the Great Recession,” she said. “However, households tend to give when they are financially and economically secure — and the inflationary pressures meant that fewer households had extra to give. In addition, donors may not have been as compelled to respond to immediate needs as they had been during the early days of the COVID-19 pandemic or during the Great Recession.”

What to Expect in the Future

The economy has only negatively affected charitable giving and resulted in fewer donations three times since Giving USA’s debut in 1982. Those years are 1987, 2008, 2009 and now 2022. (In 2013, there was a 0.6% decrease, which GIving USA typically considers flat.)

In 1987, donations reached $82.2 billion, which was a 1.3% decline over the prior year. Once again, individual giving was a strong factor, with a 3.8% year-over-year decrease. Giving rebounded in 1988, jumping 7%.

The Great Recession brought back-to-back years of decreased giving. In 2007, giving saw a record year and the first time giving surpassed $300 billion; however, the next two years experienced a 3.7% and 8.3% decline, respectively. There were both corporation and individual declines in 2008, whereas bequests dropped sharply in 2009. Though corporation support rebounded in 2009, foundations and individuals also cut their support slightly that year. But most importantly, in 2010, charitable giving rebounded with 4.9% growth.

“Declines in giving like those we saw in 2022 have a tangible impact on nonprofit organizations, especially those that rely on charitable dollars to support their daily work,” Amir Pasic, Ph.D., the Eugene R. Tempel Dean of the Lilly Family School of Philanthropy, said. “Nonprofits and donors alike experienced the steady, negative impacts of inflation such as the growing cost of goods and high interest rates throughout 2022, and many of those challenges remain. However, Giving USA’s historical data also provide a case for hope: We have seen charitable giving rebound from each decline.”