The U.S. economic rebound last year pushed the stock market up and the jobless rate lower, helping to boost charitable giving in the country to a record $456.7 billion—a jump of more than 9 percent from the year before.
But 2015 may be a tougher year for nonprofits, according to a recent survey.
The total pool of donations was boosted by a seasonal year-end surge, according to Atlas of Giving, which tracks charitable giving month by month. But based on a variety of economic and demographic factors, the group is forecasting a 3.2 percent decline in giving this year, to $442.1 billion. It says its team of 25 mathematicians uses dozens of economic algorithms, but doesn’t provide specifics on its methodology.
Last year’s continued rebound in giving was driven by double-digit stock market gains, while a stronger job market helped boost consumer confidence. In the second half of the year, a plunge in gasoline prices also helped increase giving, the group said.
The rise also comes as there are more groups raising funds and more ways to give, according to the survey. The number of nonprofits has grown 50 percent since 2002, and many of them have turned to more sophisticated fundraising technologies like online giving and crowdfunding. The bulk of the contributions were small gifts from individuals; mega-gifts of $100 million or more accounted for just 1 percent of the total.
While the U.S. economic rebound appears to be on track, Atlas of Giving is forecasting a down year for charities in 2015. The projected drop is based on some of the same forces that propelled giving last year.
The stock market’s recent correction will likely throw cold water on giving to nonprofits that rely heavily on major gifts or campaign giving, including college endowments, according to the group. The Federal Reserve‘s expected increase in interest rates will also create a headwind for giving. And the ongoing slowdown in Europe will prompt U.S. corporations to tighten up on charitable gifts, Atlas of Giving predicts.
The researchers acknowledged, though, that their “forecast will change as events unfold throughout the year.”