Giving USA Releases Report on 2014 Giving—Which Sector is the Big Winner?

Giving USA released its annual report on charitable contributions, compiled by Indiana University's Lilly Family School of Philanthropy, back in June, and to paraphrase an old presidential adage, the state of the arts philanthropic union is really strong.

The report found that donations to arts and culture rose 9.2 percent in 2014—an impressive figure, especially considering the fact that the growth of the U.S. economy remains relatively sluggish. How impressive? A closer look at the numbers shows that, of the nine categories, the two areas that saw the highest year-over-year growth were environment/animals, and—you guessed it—arts, culture, and humanities. What's more, neither sector saw a decline in current dollars since the end of the recession.

Here's how its year-over-year increase (not adjusted for inflation) stacks up against the other eight categories:

  • Arts/Culture/Humanities: +9.2%
  • Environment/Animals: +7.0%
  • Health: +5.5%
  • Public-Society Benefit: +5.1%
  • Education: +4.9%
  • Human Services: +3.6%
  • Religion: +2.5%
  • Foundations: +1.8%
  • International Affairs: -2.0%

That said, the arts sector, while bullish, remains a small piece of the pie. Estimated gifts to arts and culture totaled $17.2 billion, a record high, although that figure represented just a fraction (4.8 percent) of the $358.38 billion total. Incidentally, Giving USA says that total represents the highest in the report's 60-year history.

It's also worth noting that some of the funds attributed to some of the other categories do in fact trickle into the arts and culture sector. For instance, as noted in the LA Times article, "Giving USA counts gifts for arts facilities and instruction on college campuses under the education heading, instead of as gifts to the arts."

Stepping back from the arts sector, here are some other interesting macro-level trends.

As goes the market, so goes giving. Giving USA noted that giving to all charitable sectors rose 5.5 percent in a year when investment markets remained "generally favorable."

The "Clinton Donor" model prevails. The Sanders campaign has noted that, dating back to 1999, most of Hillary Clinton's donors have been relatively small in number but disproportionately generous. Examples include Citigroup ($782,327) and Goldman Sachs ($711,490). Sanders' campaign, meanwhile, relies on tens of thousands of small donors giving as little as $5 or $10. We guess it would be heartwarming to say that the overall rise in philanthropy resembles Sanders' approach, but alas, this is not the case. Giving USA noted that much of the overall growth is thanks to large gifts, ranging from $200 million to nearly $2 billion. (Not that we're complaining.)

Techies to the rescue. The report notes that a majority of these mega-gifts come from young tech entrepreneurs. (To that end, check out IP's take on five tech philanthropists to watch.)

Now let's circle back to the arts sector and pose the $64,000 question: Acknowledging that the arts remains a small piece of the overall philanthropic pie, its growth and resiliency is nonetheless impressive. Why?

For starters, we here at IP can attest that nonprofit organizations—whether framing the arts through the lens of creative placemaking, economic growth and jobs creation, or as a mechanism to plug public funding gaps—have become increasingly adept at communicating the value of the arts. What's more, more organizations are effectively measuring their performance and impact, showing foundations that their money is being well-spent.

Taken in tandem, it's a perfect storm that, if trends continue to hold—and evidence suggests they will hold—should continue to intensify over time.