Charitable Giving Bounces Back, Grows 1.3 Percent

The latest edition of the Blackbaud Index revealed that overall charitable giving increased by 1.3 percent for the three months ending April 2014, after initial reports last month indicated negative growth in the sector.

Among the 3,281 charities that raised $1.8 million online in the past 12 months, online giving grew 7.9 percent compared to the same period in 2013 according to the Index, which is updated monthly by Charleston, S.C.-based Blackbaud.

The Blackbaud Index, which tracks data from 4,138 organizations that raised more than $13 billion in the past 12 months, had some concerned last month when it reported that overall charitable giving declined by 0.7 percent for the three months ending March 2014. Those numbers were updated in this edition of the Index, showing that overall giving actually increased by 2.1 percent, while online giving – which was originally reported to have increased by 12.8 percent – was revised to reflect a 9.7 percent increase.

According to Steve McLaughlin, director of the Idea Lab at Blackbaud, the numbers changed because they added organizations to the Index. This is because they only add nonprofits that have 24-months of data, and some of the groups they added had not hit that requirement at the time of publishing. McLaughlin also added that there is a “lagging effect” from backlogged gifts.

Some of the big drivers of the April 2014 numbers were organizations with a budget of more than $10 million (2.4 percent), faith-based groups (1.3 percent), environment and animal welfare (5.1 percent), and international affairs (5.1 percent). McLaughlin was particularly pleased with the increase of international affairs given that last year these organizations had a 10 percent increase during a time of many natural disasters.

“I would view that as a positive sign, because we’re back to a normal level of giving to those organizations and they still increased over a strong previous year,” said McLaughlin.

Another change in the update to the Blackbaud Index is the introduction of higher education as a new specialty index. Tracking fundraising revenue for 558 U.S. colleges and universities that represent $1.5 billion in annual revenue, the index showed overall giving to these institutions grew 0.8 percent in the three months ending April 2014, as compared to the same period in 2013. Online giving for 416 colleges and universities that raised nearly $140 million over 12 months grew 20.5 percent during the same period.

The new higher education index brings the number of specialty indices up to 10, which are: Arts & Culture, Environment & Animal Welfare, Healthcare, Human Services, International Affairs, K-12 Education, Medical Research, Public & Society Benefit, Faith-based, and now, Higher Education.

“Higher education is a very important sector in philanthropy in the U.S., and while most groups that track giving to higher education report results on an annual or semiannual basis, this new index will provide nonprofits with charitable giving trends on a monthly basis,” said Chuck Longfield, creator of the Index and chief scientist at Blackbaud. “Helping to fuel that growth, particularly at schools with capital campaigns, was a healthy stock market so that bodes well for their capital giving.”

Overall giving to higher education for the three months ending March 2014, meanwhile, grew 1.3 percent; online giving to these institutions increased by 19.5 percent.