The sector has been rocked by the economic downturn and the overall financial landscape is bleak.
The current climate of reduced public sector funding , a slump in individual giving and increased demand for services threatens to make a considerable dent in charity finances, forcing some to close and putting increased pressures on others.
In response to this and in an effort to address these key issues, CAF asked Professor Sarah Smith of Bristol University to revisit the report she co-wrote in 2011, The New State of Donation: Three Decades of Household Giving to Charity, and refresh it with up-to-date figures on giving.
Both the original and the new study – Mind the Gap: The growing generational divide in charitable giving – give interesting figures on the demographic split when it comes to philanthropy, with the key focus of new paper being on the disparities between generations and how they give.
The report finds that charities are more heavily reliant than ever upon the generosity of the over 60s. While charitable donations from older people have doubled since the 1980s, the proportion of donations made by the under-30s has more than halved. Incomes might have risen in real terms, but charitable donations from the younger generations have remained static since 1980 in terms of the amount given, though donations from older generations have steadily increased.
This shows that those born during the Second World War and the ‘Baby Boomers’ who followed, seem to have shown remarkable philanthropic commitment throughout their lifetimes, but it also means that there may be trouble ahead as in the future we can expect the philanthropic donations of these older generations to tail off.
The research shows how, when comparing the youngest households (under-30s) with older households, the generosity gap has progressively widened over time – for example, the over-75s now give ten times more (as a proportion of their total spending) than the under-30s, compared to three and a half times more in 1980.
It is vital for the sector that we stimulate interest in charity amongst these younger, less engaged generations to protect the future of charities and voluntary organisations. More worrying is the prospect of a ‘donation deficit’, where younger generations do not match the generosity of those that came before them.
They key findings of the research are below:
Mind the Gap: The growing generational divide in charitable giving
The last three decades have seen a growing generational divide in charitable giving in the UK:
- More than half of all donations to charity (52 per cent) now come from the over-60s, compared to just over one-third (35 per cent) thirty years ago.
- The over-60s are now more than twice as likely to give to charity as the under-30s. In the most recent year of our data (2010), we observe 32 per cent of the over-60s having given in the past fortnight, compared to 16 per cent of the under-30s. This compares to 29 per cent and 23 per cent respectively for the two age groups in 1980.
- Older people are typically more generous than younger, giving more as a share of their total spending. This “generosity gap” has widened over the past three decades. The over-60s are now more than six times more generous than the under 30s compared to less than three times more generous, thirty years ago.
- These changes arise from fundamental generational shifts in giving behaviour. An earlier trend of increasing participation across cohorts has been reversed, while an earlier trend of increasing generosity across – and within – cohorts has been replaced by much flatter profiles.
Here you can find CAF’s five point action plan to government, businesses and charities to tackle this potential donations deficit and close the generation gap in charitable giving. Actions that we hope will embed a greater sense of giving and philanthropy across the age spectrum and entrench new habits of regular giving.
We’ll be raising awareness of this vital issue for the sector by taking it to the political party conferences and launching a campaign around our key asks. We’ll be debating the detail by holding a fringe event at each. You can read more about our panels and when and where you can join us here
Coverage of the research:
Today programme audio clip (from 1hr 12mins in) http://www.bbc.co.uk/iplayer/b006qj9z/console
 The New State of Donation: Three Decades of Household Giving to Charity, 1978-2008 by Edd Cowley, Tom McKenzie, Cathy Pharaoh and Sarah Smith, Feb 2011