Total US philanthropic giving decreased significantly in 2022, one of only four times the metric has dipped in the last 40 years. The latest annual report by Giving USA shows that total giving for 2022 declined by 3.4 percent in current dollars (or 10.5 percent after adjusting for inflation) to a total of $499 billion—down from $517 billion in 2021.

The report’s findings, researched and compiled by Indiana University’s Lilly Family School of Philanthropy, are not entirely surprising. Philanthropy had been especially strong in 2020 and 2021, largely due to giving related to the COVID-19 pandemic, as well as to racial and social justice movements in the United States. In 2021, total giving exceeded a half trillion dollars for the first time ever.

At the same time, 2022 saw both sharply rising inflation and a downturn in the US stock markets—the S&P 500 index fell nearly 20 percent—both of which events negatively affected wealthy donors’ bottom lines.

Philanthropy had been especially strong in 2020 and 2021.

“One of the reasons we saw a decline in giving by individuals was because of that stock market loss,” notes Dr. Anna Pruitt, managing editor of the Giving USA report for the Lilly School. “We know historically that can really affect high-net-worth donors. On the flip side, you know, we also saw disposable personal income go down as well, especially when we adjust for inflation. That just means that households have less to give.”

The report’s findings, researched and compiled by Indiana University’s Lilly Family School of Philanthropy, are not entirely surprising. Philanthropy had been especially strong in 2020 and 2021, largely due to giving related to the COVID-19 pandemic, as well as to racial and social justice movements in the United States. In 2021, total giving exceeded a half trillion dollars for the first time ever.

At the same time, 2022 saw both sharply rising inflation and a downturn in the US stock markets—the S&P 500 index fell nearly 20 percent—both of which events negatively affected wealthy donors’ bottom lines.

“One of the reasons we saw a decline in giving by individuals was because of that stock market loss,” notes Dr. Anna Pruitt, managing editor of the Giving USA report for the Lilly School. “We know historically that can really affect high-net-worth donors. On the flip side, you know, we also saw disposable personal income go down as well, especially when we adjust for inflation. That just means that households have less to give.”

The decline in individual giving is especially significant because of the outsized role it plays in overall American philanthropy, according to Dr. Una Osili, associate dean for research and international programs for the Lilly School, who oversaw the research. “Individual giving is the largest share of American philanthropy. And we’ve seen that individuals now have a relatively small share of overall giving. It’s down to 64 percent,” Osili says, which reflects a trend over the last several years; individual giving as a share of total giving has continued to decrease after it dropped to 70 percent in 2018, which was considered low at the time.

The report found that while individual giving declined significantly (13.4 percent when adjusted for inflation), corporate charitable giving actually increased slightly, in unadjusted dollars, from 2021 to 2022, rising by just over 3 percent (although representing a decline of about 4 percent after adjusting for inflation). Giving by foundations also proved more robust, growing by about 2.5 percent from 2021 (a decline of 5 percent, adjusted for inflation). In other words, though all sources of charitable giving showed declines in adjusted numbers, these declines were much smaller for corporations and foundations than for individuals.

Read the full article about philanthropic giving by Isaiah Thompson at Nonprofit Quarterly.