An article on yesterday’s E-Jewish Philanthropy caught our eye because the authors did a really interesting bit of research into the top givers in US in this calendar year. The study by Robert I. Evans and Avrum D. Lapin demonstrates how useful a careful parsing of statistics can be for fundraisers, and how that parsing can uncover shifting trends in the philanthropic world.
The ostensible foundation of their work was to try to explain why some 130 of the wealthiest Americans on the famed Forbes 400 list are Jewish, yet only about thirty of them have given gifts that break into the list of top donors as compiled by The Chronicle of Philanthropy. They have discovered not so much a shift in the habits of giving among Jewish donors but demographic and economic shifts that are opening what they call ’emerging charitable markets.’ Who is participating in these markets?
Religious affiliation certainly offers wealthy individuals an inspiration to give. But Evans and Lapin point out that when religious faith is discounted or equivalent, the notably middle class give more than their wealthier brethren and sistren: “individuals who earn between $50,000 and $75,000 annually give a higher percentage of their available, discretionary income to charitable causes (7.6 percent) than those individuals who make $100,000 or more (4.2 percent).” The difference in giving is even more pronounced if the wealthy sample lives in a predominantly wealthy ZIP code.
From their focus on Jewish philanthropists, Evans and Lapin see another eco-demographic shift: younger gift-givers are coming from professions that have garnered a great deal of wealth only in the last few decades. The stereotypical ‘rich Jewish doctor/lawyer’ is giving way to the software developer or financial planner or startup organizer. These groups of donors want to be approached in similar ways they have approached their own businesses or the venture capitalists who supported them.
Which means that we are seeing an ’emerging charitable market’ of fairly recently ‘well-to-do’ people (who also tend to be younger and tied into the technologies and activities of Generation X or Millennials) who want to support specific causes for specific amounts − rather like investments. They want to be kept apprized of how the ‘investment’ is doing, rather than handing large sums to foundations or large institutions that might rename a building for the donor, but can’t really tie this or that dollar to a specific outcome.
The authors also note a shift away from giving within what they call an “old-boys’ network.” Women are giving more than men across the economic spectrum (though here the authors are concentrating on those donors who identify themselves as Jewish), and many more dollars are being given from states that run between Texas and Delaware than was true a generation ago (when established New England families gave the most).
Their digging into the shifting practices of donors of the Jewish faith applies to donors of other faiths − and likely to those with more secular/humanistic motivations. The ability for institutions to present their reputations and expect big donors to come to them is fading.
While statistical reports are important and contain valuable overviews about practices across the U.S., we are also seeing major changes in donor attitudes and behaviors. No longer can nonprofits in the Jewish community sit back and expect Jews to voluntarily step forward with capability gifts. The questions donors are raising are tough ones, the rationale for “investing” in the work of all types of nonprofits vary by the ages of donors, and in our fast-paced lives, donors are looking for quick “sound bites” to compel them to give.
Does your strategy in fundraising take into account how the demographics and gift-giving habits of your constituency is shifting? Evans and Lapin provide some really useful ways to think about the changes and to consider how to tap into the growing charitable market.