Where has all the philanthropy gone? More and more to the biggest.
The Giving USA 2014 Annual Report shows that donor giving has just about returned to pre-recession levels. You can get a free copy of the short report. It has those tables about where philanthropy comes from (90% from individuals when you count bequests and family foundations) and where it goes (religion again the winner at 31%,though that’s a decrease over the last two decades).
But what the report doesn’t cover is the income stratification in this sector. Where does the money go if we look at nonprofits by size? And how has that changed over time?
Using National Center for Charitable Statistics data from the Business Master Files, I looked at the numbers of organizations by expenditure size in 1995, 2000, 2010 and 2012. The chart below shows the growth in the number of public charities using only the data from those filing Form 990*. The colored areas represent the proportion of the total number. As you can see, public charities below $100,000 in expenditures (the bottom of the chart) account for just about 44% of the total number of charities, while those over $100 million (top of the chart), are just .07%. If you add together the top two categories, organizations above $10 million in spending, they total only 4.5% of reporting US public charities.
But here’s where it gets really interesting. In order to look at the sources of data using the readily available, I had to switch over to the NCCS Core Files of public charities which is not an exact match in numbers to the BMF. But it was the only way I could view the category on the 990 called “Contributions, Gifts & Grants,” which is most of the philanthropy. The good news is that the amount of giving increased, reflecting the growth in numbers. That growth came at the top, with the top 4% of charities receiving 66.4% of total dollars given (the top two bars), up from 51% in 1995. The contributions received by those small organizations at the bottom (under $1M) stayed pretty flat, compared to the bigger organizations.
These disparities worry me a lot. Like US society, the gains have come at the top.
We already know that organizations with more fundraisers raise more money. And the smallest organizations, if they can afford a fundraiser at all, can’t compete financially for talent with the big guys.
But this is a lot to chew on before a holiday weekend. I’m hoping to break this data down even more in a future post.
*The number of public charities that did not report is very large, ranging from 332,305 in 1995, to 585,526 in 2012.