Contributions from all sources of charitable giving in the U.S. will grow by 4.8% and 4.9% in 2015 and 2016, according to predictions in a new report from the Indiana University Lilly Family School of Philanthropy and Marts & Lundy, a consulting firm.
Expected growth of total giving in each of those years will exceed the estimated 3.1% annualized average rate of growth in total giving in the years following the Great Recession and the estimated 3.8% long-term average trend for the 1973–2013 period.
The report said average annual giving would increase by $17 billion in the five-year period 2012–2016, compared with an average decline of $6.7 billion in 2007–2011.
Americans gave an estimated $335 billion, or 2% of U.S. GDP, to charity in 2013, according to Giving USA 2014.
The Lilly/Marts & Lundy report predicted that individual and household giving would account for about 70% of total giving this year. These contributions from households that itemize charitable deductions and ones that do not would increase by 4.4% in 2015 and by 4.1% in 2016, it said.
Two factors will account for a majority of this giving: projected growth in personal income and above-average projected growth in household and nonprofit net worth.
Foundation giving, accounting of 15% of total giving, is projected to rise by 7.2% and 6.7% in 2015 and 2016, and that of estates, accounting for 9% of total giving, by 2.7% and 6.3%.
Corporate contributions, which make up 5% of total charitable giving, are expected to grow by 6% in 2015 and by 4.8% in 2016.
“While the economic and financial sector has seen greater than normal economic volatility in recent years, the projected growth in the overall economy suggests a more stable and more positive environment for philanthropy,” Una Osili, the Lilly Family School’s director of research, said in a statement.
This will have implications for donors and nonprofits, Osili said. “Importantly, though, increasing philanthropic giving will require that nonprofits have not only a positive economic environment but also a strong, clear case for support and thoughtful cultivation of donor relationships.”
— Check out Top 10 Most Generous U.S. Donors: 2015 on ThinkAdvisor.