Giving USA 2024: The Impact on Religion
Giving USA 2024: The Impact on Religion
By Anna Pruitt, PhD and Jon Bergdoll
Giving USA 2024 reveals that giving to religion was hit hard by the pandemic: it is the only measured cause area where donation levels were lower in 2023 than they were in 2019, prior to the pandemic, when adjusted for inflation. In terms of inflation-adjusted dollar amounts, giving to religion peaked in 2016, and has declined in five of the seven years since.
The Giving USA report is the longest-running and most-trusted annual report about charitable giving in the United States, researched and written at the Indiana University Lilly Family School of Philanthropy in partnership with the Giving USA Foundation. Each year, Giving USA estimates how much individuals, bequests, corporations, and foundations gave to charity – and how much went to each of the nine major types of recipient categories.
Historically, giving to religion — defined as giving to congregations, religious media, and missionary societies — has been the largest recipient category. Forty years ago, religion represented 60% of total giving. While giving to religion remained the largest category of giving in 2023, it represented only 24% of the total. Giving to religion has been declining as a share of the total for many years, in part because the other categories for giving have grown much more rapidly. However, the trend appears to be accelerating. In the ten years prior to the pandemic, giving to religion hovered around 30-32% of total giving. However, in 2020, giving to religion dropped to 26% of the total and has not surpassed that percentage since.
As two of the lead researchers on the Giving USA report, we believe it is important to understand more about why giving behaviors appear to be changing, and what fundraisers and practitioners can do to address these issues. Drawing on research from around the field, we have some theories about why we might be seeing these worrying trends.
First, multiple studies have reported a decline over time in the percentage of Americans who identify as religious and in attendance rates for religious services – two factors that have long been linked to charitable giving. In-person events appear to be one part of American life that has struggled to fully recover after the shutdowns in the wake of the Covid-19 pandemic. For instance, several studies of performing arts organizations also show that audiences have been smaller in the past few years than they were pre-pandemic.
Second, the sources of giving are also shifting over time. Giving by individuals is growing relatively slowly compared to giving by foundations and corporations. In other words, giving by individuals is shrinking as a share of total giving over time – in 2023, individuals represented 67% of the total, compared to 40 years ago when individuals represented 82% of the total. Giving by individuals declined in inflation-adjusted terms in four of the last seven years due to some of the dampening effects of the Tax Cuts and Jobs Act, declines in the stock market, and higher-than-average inflation. Given that individuals, rather than foundations and corporations, tend to make up a disproportionally large share of donations to congregations, the challenges of the giving environment for individuals may be echoed in the giving to religion giving total as well.
Finally — and relatedly — the trend of “dollars up, donors down,” in which nationally we’ve seen a decrease in the number of donors while overall dollars given have continued to increase, has implications for giving to religion. IRS data shows that in 2011, the top 100,000 households according to Adjusted Gross Income (AGI) donated about 10% of the total that year—by comparison, in 2021, that percentage had doubled to 20% of the total. This matters because wealthy donors tend to give a smaller share of their total giving to religion when compared to everyday, middle-income donors. Several other studies by our school highlight this trend, including the Philanthropy Panel Study and the Bank of America Study of Philanthropy: Charitable Giving by Affluent Households. In 2018, the most recent year for which all these data are available, giving to religion represented 60% of total dollars given by the general population, but only 43% of total dollars given by affluent donors.
Additional research is needed to determine whether the charitable giving that was previously going to religion is being redirected to other causes, such as religiously-affiliated food pantries or other service organizations, or whether those dollars have stopped going to nonprofits altogether. One approach may be to define nonprofit organizations by whether they are religiously-identified, as some recent studies have done, and analyze those giving trends. As we prepare for next year’s Giving USA and beyond, we will continue to carefully monitor these questions and others to better understand this important area of giving.
Expanded Perspective: An Invitation to Collaborative Research
By Dustin D. Benac
In my role as Director and co-founder of the Program for the Future Church, I periodically receive some version of a question: “If you could look into a crystal ball, what is the future of the Church?” While the question is often asked with a combination of jest and curiosity, it also reflects humans’ fundamental interest, if not preoccupation, with the future. “Our minds brim with futures,” Martin Seligman notes, “This is not to be fought. The future is our nature. We are creatures who are drawn to the future.”[1] We are drawn to the future, and yet, the future is uncertain for so many individuals and communities.
The future is especially uncertain for faith communities. The shifting structure of religious giving is introducing a sea change in the way people and communities understand and secure resources; there may not always be a deficit of resources, but the prevailing models of giving and receiving funds are changing.[2] The ways individuals and communities imagine and organize their common life are changing. We are, as Ted Smith has noted, in a period of organizational reshuffling. The prevailing organizational forms that were built around conventions of association, or gathering, are no longer fixed. In their place, new forms, with new conventions of gathering, leading, and belonging, are emerging.[3] Simultaneously, increasing loneliness, polarization, and acute mental health concerns are silently eating away at individuals and communities.[4] These trends do not impact our faith communities equally, but slowly lessen the connective capacity of individuals and communities to undertake the type of futuring work religious leadership requires. Even though we long to know the future, we’re increasingly left only able to consider and care for pressing crises of the current moment.
Nevertheless, I am willing to bet on two realities for the future of the church: collaboration and hope. Collaboration is needed to allow individuals and communities to gather around a compelling collective vision for their common life. Shifting structures of leadership require faith leaders to be good partners in communities, to build strong teams, and to release volunteers in mission and ministry. Religious leadership requires moving beyond leading alone and inviting others to do the same.
When individuals and communities receive the gift of belonging through collaboration, it becomes a source of hope. As I wrote in Adaptive Church: Collaboration and Community in a Changing World, new structures of belonging are emerging on the other side of Christendom that are marked by commitments to collaboration. Individuals who inhabit these structures are finding their imaginations bent toward hope through the connections, collaborations, and sense of place that animates their shared work. Hope is building, we only need to know where to look.
These two realities, collaboration and hope, inform the Program for the Future Church’s current research on leadership and loneliness. Following two phases of qualitative research, we are now inviting faith leaders from across North America to participate in a survey that will help us understand and support the current and future expressions of mission and ministry, both within congregations and in the various other places people of faith gather or serve. We hope the findings from our research will provide you and other religious leaders with a better understanding of the changing landscape of religious organization and the practices that support collaborative approaches to mission and ministry.
Join us in our work to support religious leaders by participating in this 15-20 minute survey. Although much about the future is uncertain, we are hopeful because of the work we are invited to do together.[5]
[1] Martin Seligman, The Hope Circuit (New York: Public Affairs, 2018), 349, cited in L. Gregory Jones and Andy Hogue, Navigating the Future: Traditioned Innovation for Wilder Seas (Nashville: Abingdon Press, 2021), 82.
[2] David King, Brad Fulton, Christopher Munn, Jaimie Goodwin, The National Study of Congregations’ Economic Practices (Indianapolis: Lake Institute on Faith and Giving).
[3] Ted A Smith, The End of Theological Education (Grand Rapids: Eerdmans, 2023).
[4] Vivek Murthy, Together: The Healing Power of Connection in a Sometimes Lonely World (New York: HarperCollins, 2020).
[5] The Program for the Future Church’s Graduate Research Fellow, Emma Cartisano, has provided research and expertise to support this collaborative work.
Facts Are Our Friends
Several years ago, Meredith McNabb wrote an Insights article titled, “How Research Impacts Religious Work.” Though she referenced our 2019 report on the National Study of Congregations’ Economic Practices, the themes connect to Giving USA 2024 as well. She notes that one reason Lake Institute on Faith & Giving exists is “to collect, curate, and/or direct reliable research in meaningful ways for congregational and denominational leaders.” As you explore the new data from Giving USA, we encourage you to reread Meredith’s article and consider how trustworthy research “can help us get ourselves grounded in an accurate picture of conditions.”
Philanthropy Outlook 2024
In this episode of the First Day Podcast, host Bill Stanczykiewicz, Ed.D. is joined by Jon Bergdoll, Associate Director of Data Partnerships from the Indiana University Lilly Family School of Philanthropy, who offers insights into the expected trends in charitable giving over the coming years. Jon discusses a study that looks at the intricate relationship between economic factors and philanthropic behaviors. While emphasizing the importance of fostering strong donor relationships, the discussion highlights the significant influence of economic indicators, such as wealth metrics and personal income levels, on shaping charitable contributions.
The episode emphasizes the importance of incorporating inflation into fundraising budgets to ensure nonprofits remain financially resilient amid an evolving economic landscape. Overall, the episode provides valuable insights into the complex interplay between economic factors and charitable giving behaviors, offering strategic guidance for organizations navigating the philanthropic landscape in the years ahead.
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