Study: Drop in Share of Americans Who Give to Charity Accelerated in First Year of Pandemic

A two-decade-long drop in Americans’ participation in charitable giving accelerated during the first year of the COVID-19 pandemic, even as the average amount given by donors increased, new research from the Indiana University Lilly Family School of Philanthropy at Indiana University Indianapolis finds.

The report, The Giving Environment: Giving During Times of Uncertainty, provides the latest data on U.S. household giving and examines how the first year of the pandemic affected charitable giving.

The study is part of the Lilly Family School of Philanthropy’s ongoing series The Giving Environment, which uncovers giving rates and average giving amounts over time. The report is based on research funded by the Bill & Melinda Gates Foundation.

The Giving Environment series analyzes data from the Lilly Family School of Philanthropy’s Philanthropy Panel Study (PPS), a part of the University of Michigan’s Panel Study of Income Dynamics (PSID). As a nationally representative longitudinal study, the PPS follows 9,000+ households over time (2000 – 2020) and provides the most comprehensive data available on giving trends by U.S. households.

The dataset for the new study spans a subset of PPS data from 2010-2020, allowing researchers to analyze the philanthropic landscape immediately before and during the pandemic.

Donors down…
The share of Americans who give to charity declined from 50.9% in 2018 to 46.9% in 2020, following the onset of the pandemic. The participation rate for 2020 is 4 percentage points lower than the share seen just two years earlier. The researchers said factors related to the pandemic hastened the decline at a faster pace than they estimate would have occurred without the pandemic. Rates of secular charitable giving experienced a sharper decline from pre-pandemic levels than did giving rates to religious congregations.

Prior to the pandemic, the share of American households participating in charitable giving had fallen from two-thirds in 2000 to about half in 2018.

…Dollars up
In contrast to declining giving rates, the study found a significant increase in the average amount given by donor households, which rose from $2,792 in pre-pandemic years to $3,116 in 2020, an 11.6% increase. In the years before the pandemic, average amounts given were largely stable. The 2020 growth was primarily driven by a surge in the amount households gave to secular causes, from $1,327 in pre-pandemic years to $1,909 in 2020, a 44% increase. The amount given to religious congregations remained consistent with pre-pandemic levels.

“This new study documents the resilience of Americans’ generosity even amidst some of the most challenging times our country has faced in recent years,” said Una Osili, Ph.D., associate dean for research and international programs at the school. “Everyday Americans increased the amount of their charitable giving in the first year of the COVID-19 pandemic even as aspects of the crisis exacerbated the ‘declining donors’ trend in the share of U.S. households who give that we’ve seen over two decades.”

Impact of the COVID-19 pandemic on giving
“The COVID-19 pandemic was one of the most significant forces of change in the charitable giving landscape in decades. This research expands knowledge of how it disrupted and reshaped American households’ giving behavior. It sheds light on whether and how pandemic factors—such as social distancing mandates, unprecedented economic loss, and COVID-19-related morbidity and mortality—may have impacted giving,” said Amir Pasic, Ph.D., the Eugene R. Tempel Dean of the Lilly Family School of Philanthropy.

• Declines in giving rates were concentrated among people who resided in communities that experienced more severe negative health and economic consequences of the pandemic.
• Individual-level pandemic experiences, such as job loss or a COVID-19 diagnosis, may have had a smaller impact on giving participation rates compared to the impact of living in more severely affected communities.
• The length of state-mandated pandemic shutdowns appears not to have impacted giving, except for giving to religious congregations. The longer the duration of mandated shutdowns, the more the giving participation rates and amounts given to religious congregations increased.

Read and download "The Giving Environment: Giving During Times of Uncertainty" report here.

Source: Lilly Family School of Philanthropy

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