A majority of donors (53 percent) say they plan to continue giving, but more carefully than before due to the COVID-19 pandemic, based on a new donor confidence study of 630 US donors sponsored by Dunham + Company. Just 20 percent said they would stop giving until the economy is back up and running.
The remaining 28 percent said they keep giving regardless of the pandemic. Donor confidence is especially strong among donors who attend religious services at least weekly. 40 percent of weekly attenders said they would keep giving, more than double the percentage of those who do not attend church or temple (19 percent).
The oldest donors, regular churchgoers, and self-described conservative donors were significantly more likely to say their giving would remain unchanged compared to younger donors, less frequent churchgoers, and liberal donors.
Campbell Rinker conducted the poll April 17-21, 2020. There is an update to this study. Click here to see more recent results.
Most Donors Expect to Give the Same or More this Year
In total, 69 percent of donors would give the same or more in 2020 than they did last year. Just over half of donors said they expected to give the same as last year, while one in six donors expected to give more. What is especially important is this sentiment is strongest among the key giving demographics of regular churchgoers (75 percent), self-identified conservatives (74 percent) and Boomers (78 percent).
Beyond this, the Coronavirus pandemic is the leading reason donors who expect to give more will do so: 33 percent of this group cites the pandemic as the main reason for giving more, compared to just 23 percent who say they expect to give more due to their financial situation.
“In practical terms, the pandemic has spooked about 10 percent of donors into giving somewhat less and encouraged about 5 percent of donors to give more.”Dirk Rinker, President of Campbell Rinker
However, the majority of donors (53 percent) say they are not facing a challenging financial situation. 63 percent of donors making more than $75,000 per year say they are doing fine. Also, 72 percent of donors in the Boomer generation and older have felt little impact. This is good for donor confidence because these groups are much more likely to give, and to give higher amounts, than donors who are younger or who earn less.
Some Donors Expect to Cut Back on Giving
Despite these positive signals, the study also showed that the COVID19 pandemic has increased anxiety among certain donors to the point where they are cutting back .
Nearly 1 out of 4 families who typically donate to charity are feeling the economic impact of COVID-19, saying they find it very challenging or extremely challenging to meet their financial obligations.
The hardest hit donor families are those who make $25,000 annually or less, with 46 percent saying they are finding it very or extremely challenging right now. In contrast, only 13% of households making $75,000 or more said the same. Minorities are also feeling the pain, with 34 percent saying they are struggling. This obviously impacts their confidence as donors.
“After one month of shutdown, 10 percent of donors overall expect to give less because of either the pandemic or the economy in general, which is a direct result of the pandemic,” said Rick Dunham, sponsor of the study. Dunham is CEO of Dunham+Company, a global fundraising and marketing consulting firm to the nonprofit sector.
One in eight donors (13 percent) expected to give less this year due to finances, the same as in August 2018.
Seven percent of US donors reported being unemployed or furloughed due to COVID-19, certainly affecting donor confidence. This represents nearly a five-fold increase in the rate of unemployment before the pandemic hit, as it was 2 percent beforehand and is now 9 percent.
Positive Long-term Outlook
Donors are confident in the work of charities as well. Six in ten US donors now say charities in America are doing either good or excellent work (60 percent), vs. 48 percent in August 2018. Donors who said charities are doing ‘excellent’ grew from 8 percent to 12 percent in the past 18 months. Only a few donors said charities are doing a ‘poor’ job, and this percentage dropped by half. These factors contribute to a stronger donor confidence rating.
This helps explain why donors are now more positive that their giving will return to normal once the economy returns (46 percent) than they were in August 2018 (37 percent). Another contributing factor might be recent gains in household income. Nearly two thirds of donors said changing income had no effect on their giving, and just one in five (19 percent) said that an income change had reduced their giving.
More than a third of donors (36 percent) said their household income has increased in the past year, while 20 percent of said their income had gone down. Also, donors are now more likely to say their household’s financial situation is “not challenging” compared to 18 months ago, and less likely to describe their finances as “somewhat challenging” (31 percent in August 2018 vs. 25 percent now).
Confidence Stronger in Older, Secure Donors
Optimism was more widespread among older donors than in younger donors. Boomers were most likely to say they would keep giving the same amount (66 percent compared to other generations). In contrast, Millennials were significantly more likely than other generations to say they would reduce their giving (31 percent agreed) and least likely to say their giving would stay the same (40 percent).
Non-white donors were significantly more likely to say their giving would increase overall, compared to white donors (26 percent vs. 15 percent).
Also, households earning less than $25K annually were significantly more likely to say their giving would increase by 50-100 percent in the coming year (11 percent vs. 2 percent for higher earning households).
Giving Expectations among Most Supported Nonprofits
As for the charities they support with the most money, donors expected in the coming year to give…
- Somewhat more to places of worship, such as a church or a synagogue (mean of 3.2, where 3.0 indicates no change).
- Somewhat less to educational institutions and programs (mean of 2.8).
- Slightly less to faith-based charities and ministries, excluding places of worship (mean of 2.9). Notably, conservative donors and those in households earning $75K annually were significantly more likely than their counterparts to say they expected to give up to 50 percent more this year than last year to ministries. Also, donors in the lowest-earning households were significantly more likely than households earning more to say they would give up to twice as much to faith-based causes.
- Slightly more to health and medical charities that work inside the US (mean 3.1).
- Less to Arts and culture (mean of 2.6).
Economic Outlook among Donors
The underlying data show that donors actually foresee a faster economic recovery than they did 20 months ago. In August of 2018, 78 percent of donors felt it would take a year or more for the economy to improve, whereas in April 2020, that percentage has dropped to 66 percent of donors who say the same. In addition, half as many donors believe it will take the economy longer than two years to improve (down from 51 percent in 2018 to 24 percent today). Finally, in 2018, just 1 in 5 donors (22 percent) thought the economy would improve in a few months to a year, whereas in 2020 , more than 1 in 3 donors (34 percent) believe the same.
“Even though donors know the economy is in a world of hurt, they are much more confident that it will rebound more quickly now, compared to how donors felt back in 2018 when the economy was picking up steam,” Dunham said.
Methodology: This online poll of 630 US adult donors who had made charitable gifts of at least $20 in 2019 was conducted April 17-20, 2020 – the height of the worldwide COVID-19 pandemic. The lowest amount given in 2019 was $20, and the highest was $66,500. Responses were weighted by age to reflect the general U.S. population per the American Community Survey of the US Census. The margin of error is ±3.9% at the 95% confidence level. Percentages may sum to over 100% due to rounding.