In 2021 the economy grew 5.7 percent - at its fastest rate since 1984 - resuming brisk expansion in the pandemic's second year with government spending that fueled a fast start. This stimulus helped to increase the spending power of many families - despite rising prices - and this impact extended meaningfully to philanthropy.
Overall, 2021 was another banner year for charitable giving in the United States, which rose to $484.85 billion, according to estimates from Giving USA 2022, published by the Giving USA Foundation. Giving grew a total of 4% compared to 2020 in current dollars, but declined 0.7% with rising inflation factored in.
Giving by individuals continues to be the single largest source of philanthropy in the US - accounting for 67% of all giving. Between 2020 and 2021, giving by individuals grew 4.9% in current dollars - outpacing overall philanthropic growth.
"Individual giving remains the largest sector of philanthropy in the US, by far. While everyday households may feel the pinch of inflation, growth in other areas show the importance of diversification within a fundraising portfolio. Nonprofits should seek to provide businesses and foundations with a case for supporting their organizations and show donors the impact that leaving you in their will can have on your cause," Jennifer Bielat, EVP of Client Strategy at Pursuant says.
Giving by corporations increased the most of any source in 2021 - increasing 23.8% from 2020 - representing the relationship corporate giving has to the economic environment. Corporate giving represents the smallest source of philanthropic giving, accounting for 4% of all giving and $21.08 billion.
Giving by foundations grew at 3.4%. Bequests declined 7.3% from 2020 to 2021, following a record year of growth in 2020 as individuals pondered mortality and the legacies that they may leave.
Mega giving by individuals totaled nearly $15 billion - and contributed 5% of all giving by individuals in 2021. As the number of annual donors who participate in philanthropy continues to decline, higher average gifts by mid-level and major donors continue to drive overall revenue to greater heights.
"While uncertainty lies ahead we know that donors fundamentally remain generous during downturns. The number of organizations they give to may decline and preferences may shift as needs emerge. Nonprofits must strive to remain their donors' charity of choice through sustained and relevant marketing and communications," Matthew Mielcarek, SVP of Analytics & Insights at Pursuant says.
Giving to the arts and culture sector, which suffered during the pandemic, climbed 27.5% in 2021 to $23.5 billion. Giving to education declined 2.8% to $71 billion, falling in part because of donations related to vaccines that were diverted to university-affiliated hospitals and research. Otherwise, giving grew or stayed flat for all other sectors.