Changes to the charitable sector? Indeed.
You’ve probably felt those changes over the last few years—nothing like a pandemic to shake things up. You might have some anecdotes or stories of how things have changed, but today we’re diving into some of the research.
In this episode, I’m talking with Jacob O’ Connor, Senior Vice President of Charity Engagement at Canada Helps, to discuss The Giving Report 2022 which highlights insights and generational giving trends facing Canada’s charitable sector that are taking place as charities are still struggling with demands and challenges from the ongoing pandemic, and now significant challenges brought about by historic inflation rates. Don’t worry if you’re not in Canada - guaranteed you will benefit from understanding these trends (because they are likely true where you are too).
Donors care about causes over affinity to specific organizations. The younger generation has a greater affinity for cause-based donations and support as opposed to giving to specific organizations. Nonprofits need to know how they position themselves as contributors to these causes. This is a great opportunity for small organizations and underscores the importance of stewardship.
Digital is here to stay. CanadaHelps saw a 119% increase year over year in giving in year one of the pandemic. Moreover, The Giving Report 2022 highlighted that younger generations find new and strategic ways to give online such as cryptocurrencies and securities.
Jacob’s Key Insights on Giving Trends 2022
The giving gap: Donors aged 55+ are giving twice the amount of the 25 to 54 age group. This gap is growing and as a sector, we need to think about where we will be when this generation no longer has the capacity to give?
Cause-based donations: The way you tell your stories and engage with fundamental causes or movements, such as social justice and environmental issues, will be very important to the next generation of donors. It’s important to know where your organization stands and how are you helping specific causes?
Leveraging current trends and reports: Further than just education providing insights, this report serves as a call to action that Canadians need to step up and engage with the sector and support the sector that gives us so much.
Favourite Quotes from Today’s Episode
Post your favourite quote on social media to share with us!
“ Canadian charities have experienced rises in demand throughout the pandemic. In our panel, we saw that 11% of Canadians are accessing charitable services for their basic needs. This number, if the effects of the inflation pandemic don't change, expects to go up to 26%, which is staggering. Charities are already struggling to meet the demands and then the effects of inflation. We need to do more, we need Canadians to step up.”
“We want to amplify that the sector needs support. Even though the pandemic is coming hopefully to an end, inflation is here and yet it was a big drop over the last few years that we need to help the sector recover from. ”
Resources from this Episode
Cindy W.: Welcome to The Small Non-profit podcast, as you do, listeners likely know I'm based in Canada and we are very lucky every year to have an incredible report on the state of giving that does a sector check-in on what's happening, how do we look at the overall trends outside of our own experiences and use that information to make decisions and to be strategic in our fundraising.
And that is what we're diving into today on the podcast. I'm your host, Cindy Wagman. And as I said, you're listening to The Small Nonprofit podcast where we bring you practical -- advice on how to get more done for your small organization. You are going to change the world and we're here to help.
So I'm really excited to welcome back to the podcast. Today's guest, Jacob O'Connor, who is the Senior Vice President of Charity Engagement at Canada Helps. And I imagine, especially for our Canadian listeners and, Canada Helps, we love Canada Helps. And Jacob has been there for six and a half years, but as he would say, non-profit work is in his blood and it's part of his sort of legacy or a family legacy. So with that, Jacob, welcome to the podcast.
Jacob O.: Thanks for having me, Cindy. Thanks for that kind of intro.
Cindy W.: My pleasure. And yeah, this is, I always love and checking in with you and having these conversations because the giving reports that Canada helps puts out in partnership with, imagine Canada, and Environics two other organizations that we love. This is really an opportunity for us. It's like a little touchstone to be like, okay, how are we doing? And I want to start by what I would call the -- news which I think is important to talk about. Not only because we need to be aware, but also people I think are feeling it, right?
Let's talk a little bit about how the sector might be feeling around fundraising these days or what they might be experiencing over the last. 12-ish months
Jacob O.: So Cindy, I'd love to get into that. And I think for an international audience, you'd be halfway to reference. Do you think it makes sense for me to intro Canada Helps just really?
Cindy W.: Yeah. Definitely, we have and I mean, to all of our international audience, this is still relevant because these are global trends. And I would say like half of our listeners, half of all of you are in Canada, and about the other half are in the states. So this is very much where your neighbors and what's happening here is happening there too. But this is a Canadian, a uniquely Canadian report. So who is Canada Helps?
Jacob O.: Yeah. So, it's quicker just to give a little bit of context. So Canada helps us also charity, we're a charitable foundation here in Canada and our mission is to increase giving through technology. We operate a -- of CanadaHelps.org where you can search for donating to or fundraise on behalf of any charity in Canada.
And then we also build fundraising technology. And offer it out to charities and along with education so they can level up visually. So our mission there is to democratize access to effective technology and education in the charitable sector. So we've been around for about 22 years. And part of our mandate is also an advocacy piece and we see the giving report as a really big part of that.
So this is our fifth annual edition of the report. It's pretty crazy. And as Cindy mentioned, this is done in partnership with Environics and dimension Canada, two great UN organizations as well.
And so this was launched really, the first edition was launched and still holds true today. So you guys, you mentioned kinda key data-driven insights into Canada's charitable sector. What the giving landscape is what the sector itself is like. And the last we talked a bit about this last year as well, but I think throughout the pandemic, as we know for all of us and charitable sector is not escaping that it's been a tough two years.
And I think this report takes on extra significance through these struggles. So I think, I guess starting with the not so good. And then we'd go into the good.
I think maybe starting with the not-so-good. I think it's good to start with what hasn't changed and if you've read previous giving reports, these are trends that we've been seeing for quite a bit of time. So I'll start just talking about overall participation rates in the charitable sector. Back in 2006, 25% of the Canadians claim donations to charity in the most recent year in 2019, that number has dropped from 6% to 19%. So overall we're seeing a decline in participation rates in the charitable sector.
When we look and drill down a bit deeper into that, what we have here. If you, again, if you've been following a different report, this is not new. But what we'd call, the giving gap. And this is essentially the fact that the older generations are taking on more of the burden of giving in Canada.
And now the 55 age plus age group is giving at twice the rates twice the amount of the 25 to 54 age group. So this gap is growing and so as a sector, we need to think about when this generation no longer can give where are we going to be?
Just I think from there, where we went to this year in the report, so what's a little bit more, let's say new is the fact that the pandemic hasn't helped the situation.
So we did a projection again, this year, a further 2% decrease we projected in overall giving. So that's a 12% drop in giving over the pandemic about a billion dollars loss through this projection. And then also into that, looking at both of those numbers, given the fact that this giving gap exists and looking at it through these age groups, we took a real focus on generational differences in giving which we can get to.
Cindy W.: Yeah. Before we get into those generational differences one of the things that have changed. A lot over the pandemic is digital adoption. And people giving online. I remember at the beginning of COVID where people were wiping down their mail and isolating their mail before they brought it inside. And so there was, and people got more and more comfortable with technology in ways that they hadn't been before. So before we dive into the generational stuff, cause it is various.
There's an opportunity, but part of that opportunity and that this will cross over to that conversation as well is digital. Can you tell us some of the trends you've seen and what people can expect there?
Jacob O.: Yeah. So I think there's quite a, there are quite a few different things to unpack there. So I think, and part of the kind of general generational differences that we'll get into where we'll focus in on yes, online as digital, but then break it down further into some channels. I think overall, we saw that in year one of the pandemic that online giving was a huge bright spot. So in year one, here in Canada helps and we're a great sample for the sector, as a whole, we saw a 119% increase year over year in giving in year one of the pandemic. So of course this is not enough to make up for the overall losses that we saw from that kind of ending all of the more traditional sources of fundraising revenue, or even earned revenue there for many organizations across the country.
And I guess the world as well, but that 119% increase was big. That increase held up until March. And then because of course, the pandemic started on March 20. Then the year over your picture changed when we got to 2021. So the good news is that that level of giving held. We didn't see losses from the previous year's giving but largely remained flat.
So giving online giving in 2021 was flat. Even a slight decrease that we saw in overall online gifts.
Cindy W.: Okay. Awesome. The good news is its people who've gone online seem to be staying online which is great. Let's talk about generational differences because the biggest thing I think that you've said so far is the difference between older generations carrying the weight of, or that responsibility of supporting the charitable sector.
What, but there's an opportunity, right. This is the insight that allows us to take action. So what do you want to see from our sector? And what're some of the evidence or data that you have in the report that can help organizations? I always think of sitting around a board table and trying to convince people to be like, this is the way to go. So how do we move towards that? And what signals are there that this is an opportunity?
Jacob O.: Yeah, that's a great question. So I think probably a good place to start is to just dig into those overall participation rates and giving rates. So I mentioned that the 55 plus age group is giving at double the rate. And I think as a sector and as a society, even we've heard a lot about it. The capacity of younger generations to give or the lack thereof. So I know we've heard a lot of references to rising house prices. Inflation, upper job markets, all of these different things, all of these different economic pressures that millennials and gen z's uniquely have maybe compared to gen X or boomers let's say.
But I think one thing that's interesting to look at is that the steepest decline in terms of all of those generations was actually with generation X. So that was actually where the steepest decline in giving participation rates was over the period. So it wasn't with our under 25 or 25 to 39. It was that 40 to 54. Okay. This is interesting. And I like to hear your perspective on that as well. I think that so I think that's a good place to start and I think the other place to start is you asked what can the sector do? I think there are two parts to it. So this year looking at this picture, that's not, we're not seeing improving this report was both a call to Canadians.
So further than just education providing insights we saw this report as a call to action that Canadians need to step up and engage with the sector and support the sector that gives us so much. And then on the flip side of it, now, this is where we're going. There are things that you can action.
There are things that you can do. And there, there is hope. There are bright spots. So let's get into that. So I think first off we talked about this a bit this last year. And the notion of the concept of donating to specific causes as opposed to specific organizations or institutions and how younger generations have a greater affinity to cause-based the donations and support.
So this also helped this year. And we're seeing that our gen Z and millennials have a way larger propensity to give to specific environmental and social justice movement. Whereas our boomers are looking at medical research seniors as you might expect, right? Across the board and maybe in line because of the strain that we've been through, the pandemic mental health was a top cause across the board through all generations which is nice to see the awareness around, around that side of things. Yeah. But I think something to think about there for organizations is the way that we tell our story and the way that we engage with these causes is going to be very important to this next generation of donors.And so what is our position? How are we contributing to specific causes and tying that into the stories that we tell?
Cindy W.: Causes, and you said the word movement, which I thought was really interesting and something that I feel like I've observed, but don't have evidence around, which is there. We've seen a lot of movements over the last few years and lots of urgent requests, how does, and taking that and not necessarily knowing which organizations to support in those times of crisis. To me that really dovetails with that idea of like it's about the movement or the overall cause, and not necessarily specific to the organization. What have you observed in the numbers or in the data around giving toward the sort of like big social calls to action?
Jacob O.: Yeah, so I think that plays out like really with those younger generations.
I think the big group that may be may because-based surprising, perhaps not where we saw the biggest growth in participation in net new donors to those that kind of cause based fundraising. This is from Environics different segments is our downtown donors. So these are younger living in Metro areas. Don't have children, they ride the bus.
This is the group where we saw that, that real affinity and propensity to give to social causes, I think really quickly for those that aren't aware of this kind of, offering or from Canada Helps
Cindy W.: yeah, go for it. I was gonna say we've had an Environics on the podcast talking about their segments, which I think is, and then tell us about how the piece
Jacob O.: Yeah. So we worked with them, but our Onyx and use their site. They use their segments to analyze our data around giving to what we have done this caused funds so just really quickly instead of giving to a single organization for maybe younger generations of donors that do have that affinity to causes, or maybe aren't yet engaged in the charitable sector, as we're seeing in the participation.
Instead of going to a charity, I can donate to a group of charities. So I donate to, let's say the environment fund, and there's a collection of 40 charities that are doing work in that area. I donate to a cause as opposed to a specific organization. And yes, we're seeing that those, downtown donors are younger generations are much more likely to be donating, to causes in general.
And then specifically the social justice causes and environment causes yeah.
And I think that as advice to organizations, especially small ones, which is our audience, it's really leaning into that, talking about how your organization is part of this bigger movement, so often I hear small organizations worry that they're not top of mind for people.
Cindy W.: And these are opportunities to say, okay, like this overall issue or causes top of mind and Hey, we're doing something about that. I see a lot of organizations step back when things happen in the world and they're like, oh, people should just find us. They're not finding you. So get out there and talk about your work, my advice.
Jacob O.: And I think on that note too, zeroing in, into our millennial and gen Z group. So from the research that Canada helps has done here. So these are two really encouraging things. So the first one is that this group is much more likely to trust charities than our boomers and gen Z. So the trust is there.