Americans are a generous bunch, and their willingness to give to help others cuts across all income levels as well as ethnic backgrounds and religious beliefs.
According to data recently released by the Giving USA Foundation of Indiana University, most of the philanthropy goes to the nation’s 1.4 million charitable and religious organizations. These entities provide a wide range of services which includes assisting individuals and groups with immediate financial, physical, or other needs to funding medical research and assuring the future of the arts and educational institutions.
There is a saying that suggests “As the economy goes, so goes philanthropy.” Donations generally track the health of the economy with the annual change normally corresponding to about one-third of the rise in the stock market.
Charitable giving in 2006 set a record of over $295 billion, which was $11.97 billion more than in 2005. This amount, when adjusted for inflation, was around 1% above 2005’s $283.05 billion. Excluding contributions for disaster relief, the 2006 amount is about 3.2% more than the 2005 gifts.
Last year, many charities reaped significant gains by developing close ties to wealthy individuals, foundations, and companies that have benefited from the ongoing economic upswing. While many gifts were from the extremely wealthy, according to the Giving USA report, nearly two-thirds of households with incomes less than $100,000 contributed to charities.
Individual donations accounted for more than 75% of all gifts with bequests, grants, and corporate giving responsible for the remainder. Some nine categories of charities were the primary beneficiaries of these various gifts with religious institutions receiving about 32.8% of the total or $96.82 billion.
Giving to education amounted to nearly $41 million or approximately 13.9% of the total estimated donations. Organizations associated with the arts, culture, and humanities received $12.51 million.
In spite of the overall increase in gifts, many non-profit organizations involved in family services, the arts, and community and economic development still faced fiscal stress that required an increase in staff working hours, which led to turnovers, and the lengthening of time required to provide services.
In a study by Charity Navigator, the nation’s largest independent charity evaluator, charities in the leading 30 metro areas generate 65% of the total revenue and expenses. Based on performance and size, along with fundraising efficiency, the cost of living, and a city’s tendency to support a few specialized causes, two Texas cities were rated among the top 10 philanthropic markets.
Dallas, which was listed 21st last year, jumped to second place behind San Diego this year. Houston, which ranked third in both 2005 and 2006, dropped to 10th position this year due in part to the costs required to secure donations.
Dallas has a high concentration of large charities related to religious activities, while the charities in the Houston area are more diverse in purpose. The largest numbers of charities in both cities are those involved with human services. In Houston, charities designed to support arts, culture, and the humanities, as well as education, represent 27% of that community’s total charities. The same categories are sustained by 17% of the Dallas charities.
The amount of charitable giving in 2006 represented 2.2% of the US gross domestic product adjusted for inflation. This proportion has remained approximately the same as represented by gifts since 1999.
With expectations for the economy to see modest growth over the short term, it’s a safe assumption that Americans, and especially Texans, will carry on the “better to give than to receive” practice and continue to improve the quality of life for those individuals and organizations deserving assistance.