Charitable giving hit record

Charitable giving in the United States reached a record $485 billion in 2021, though the increase did not keep pace with inflation, according to a report Tuesday offering a comprehensive look at American philanthropy.

The Giving USA report says donations in 2021 were 4% higher than the record-setting $466 billion contributed in 2020. But they were down 0.7% when adjusted for inflation.

Many nonprofits are now feeling the strain because giving is not growing as fast as price increases, said Laura Macdonald, chair of the Giving USA Foundation. In response to the intense needs of the early COVID-19 pandemic, as well as the calls for racial justice, giving increased in unusual ways in 2020, but has generally returned to previous patterns.

“In 2021, many donors returned to their favored causes, with many of the sectors that struggled in 2020 making a recovery in 2021,” Macdonald said in a statement.

The proportion of giving by individuals totaled less than 70% of overall giving for the fourth year in a row in 2021 and the report found that giving from individuals was essentially flat in 2021 when accounting for inflation, up 4.9% to $327 billion. That’s still not near the peak of 2017 when individuals donated about $335 billion when adjusted for inflation. Experts say those totals contradict proponents of the Tax Cuts and Job Acts, which passed in 2017, who claimed the legislation would increase giving.

“Everyday households are not participating in charitable giving to the extent that they did a decade or two ago,” Macdonald said in an interview. “And that’s concerning.”

Giving to arts and culture groups, which suffered during the pandemic, climbed 27.5% in 2021 to more than $23.5 billion. Conversely, giving to education declined 2.8% to $71billion. It had spiked in 2020 in part because of donations related to vaccines which went to university affiliated hospitals and research.