IMPACT

Charitable Donations Expected To Drop For First Time Since Recession: Report

Because it's an election year, some people are redirecting funds to political campaigns.

Charitable giving in the U.S. is on the decline for the first time since the Great Recession, which should serve as a “wake-up call” to nonprofits, a new report concluded.

The Atlas of Giving report, released Thursday, found that donations in the U.S. are slated to drop by 2 percent this year. The decline is due to a number of factors that span the economic, political and religious spectrums.

Being that it’s an election year, some donors are redirecting funds to political campaigns. The annual forecast for U.S. gross domestic product has been lowered, an indicator that giving tends to closely follow. Church giving, the largest charitable giving sector, is declining at a faster rate than the national giving rate.

And stock market volatility has made donors “uneasy about the economy and their personal financial situations,” Rob Mitchell, CEO of the Atlas of Giving, said in a statement.

January marked the first drop in donations after a 63-month streak during which giving consistently rose.

Just last year, giving rose 4.6 percent from 2014, according to the report.

Contributions increased across a number of sectors last year, according to Blackbaud, a company that provides nonprofit software and services.

International contributions were driven by a number of global disasters, including the Nepal earthquake and flooding in India, Malawi and Mozambique. Donors also increasingly used their mobile devices to make contributions to causes.

To attract and retain donors, studies show that donors expect engaging content and a personalized approach, according to a survey from Abila, which provides software and services to associations and nonprofits. 

Nearly 75 percent of respondents said they’d drop an organization if it released dull, vague or irrelevant content. About 71 percent of donors said they feel “more engaged” with a nonprofit when they receive content that’s personalized.

Mitchell advised nonprofits to pay close attention to the concerns donors may have and to address them head on.

“Sometimes, simply sharing an awareness of an issue that’s weighing on the mind of a donor will help build trust and may open a useful conversation,” Mitchell said in a statement. “So, for instance, a fundraiser paying attention to trends in oil prices can adjust strategies and outreach for different populations within their donor base accordingly. That might mean offering donors who are feeling the pinch from the oil downturn some alternative and creative ways they can continue supporting causes that are important to them.”

 

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