In times when the economy is thriving, philanthropic giving is just as healthy as the money being generated in the private sector. However, when there is a downturn, giving trends decline along with the shrinking economy even though the demand for donations surge. This economic conundrum is now beginning to shift, as new groups open their pocketbooks and donate differently than what was the historical tendency of philanthropic giving.
During the Great Depression, philanthropic giving occurred within affluent families, which consisted of white men, with an inheritance of money, or money they gained through business. Giving dwindled dramatically as more families needed much more assistance from the layoffs and decrease in job opportunities. The bulk of giving occurred with families helping other families. The families with slightly better means depleted their funds, and eventually added to the groups demanding assistance.
Now in the 21st Century, layoffs are high, and the hesitancy of businesses to rehire is supplying jobs for only a few of the masses seeking employment.
Philanthropic giving, again, is in a decline when so many need assistance. Unlike the times of the Great Depression, philanthropic giving has other options, rather than obtaining help from the wealthiest, many racial groups today are donating more of their own money, in comparison to the richest Americans.
Rather than being delineated to large national charitable organizations, these donations go directly to those who need immediate relief.
Historically, donations to national service organizations were the only contributions studied, and they are predominantly from individuals making over $200,000 annually, middle-aged white men who are either self-made, or possess inherited wealth. In 2003, studies began into the philanthropic giving to community organizations, local groups, and other forms of contributions as well as national service organization donations. The findings showed that populations in the more varied donation categories were just as diverse as their forms of contributions.
The article “About Philanthropy” from The Association of Baltimore Area 
Grantmakers, finds that 53 percent of African-American households donate to charity. Of those donations, churches and other religious functions receive 59 percent of those contributions. Anywhere from 4, to 8 percent of their discretionary income is donated by African-American homes, which is 25 percent more than white households. The amount of discretionary income, in general, typically goes to charities in all racial groups, and is higher than the donations by those individuals who earn more than $100,000 thousand annually. The article says, “People with less wealth have traditionally given more of their incomes, proportionally, to charity.” Earners of $100,000 or more annually, contribute 2.7 of that salary. Those receiving an annual salary ranging between $20,000, to $29,000 donate 3.9 percent of their earnings.
Hispanic and Latinos are the fastest growing racial group in the United States, estimated to become 25 percent of the U.S. population by 2050. Along with the overall population of Hispanic and Latinos increasing, household salaries are also rising, at a rate of twice as much more than the general public.
Katherine Swank, in the article “Emergent Philanthropists: America’s Evolving Ethnic Donor Groups,” explains this population is younger, under 40, acquiring their wealth through small, family-owned businesses. Charitable donations tend to be directed toward the poor and person-to-person rather than to larger charities. Swank concludes, “Millions of dollars are sent to relatives abroad, or given to other family members before charitable contributions are considered.”
This form of giving is difficult to track with the amount of contributions projected to be much higher than the latest estimates. Hispanic donations resemble the contributions donated during the Great Depression, when families assisted other family members. Giving directly to a person occurs much more within the Hispanic populations than any other group.
Asian-Americans’ salaries are the highest amongst all other groups. With a culture centered on family, like Hispanics, Asian-Americans adhere to the tradition of giving that is so integral to their beliefs. Donations to family at home and individuals are also similar contribution patterns between Asian-Americans and Hispanics. Small business endeavors through food, lodging, and personal services, is how Asian-Americans predominantly acquire their wealth.
Swank says, “This generous group gives money, skill and time to help organizations, and efforts that enhance their communities; often they seek involvement in the projects, or even leadership positions.” Philanthropy of Asian-Americans is not presumed to be recognized or celebrated rather it is more of an obligation to the community.
African-Americans, 
Hispanics, and Asian-Americans replace the conventional all-encompassing donation by contributing to either specific community organizations, or family members. Assets of community organizations have grown six times because of the increase of philanthropic giving to those smaller foundations. The “About Philanthropy” article says, “The reach of community foundations into all parts of their geographic territory has been expanded in recent years by the creation of geographic component funds, of which there are now 1,500 nationally, with 75 percent estimated to be operating in rural communities.” Geographic component funds allow donations to be concentrated in a community foundation for a precise geographic area.
Along with community contributions, the Internet enables differing groups to contribute to a wide-range of local, community, and national foundations as easy as a click of a mouse. Larger donations of $1,000 or more are surging,
Even with the growth of racial groups and other unconventional philanthropists, donating still follows the traditional trend of decreasing as the economy shrinks. When the current recession arose (which the Bureau of Labor Statistics identifies beginning December 2007), it is gauged that donations dropped 27 percent. This decline measured through the Philanthropic Giving Index (PGI), administered by the Center on Philanthropy, is the highest with the next drop in PGI of 9 percent occurring in 2001. The Center on Philanthropy at Indiana University’s article, “Briefing on the Economy and Charitable Giving December 2008” shows that, “Most households continue to give during times of financial insecurity, although some give less compared to periods of prosperity, and some donors become non-donors, especially those earning less than $50,000 a year.”
As the pressures of economic times stress philanthropists with lesser means, the contributions to family members, local, and community mimic the Great Depression. Individuals with lesser discretionary funds donate until those funds become depleted, and then join in with families they were initially assisting for services, causing the continued dwindling of help with demand persisting and intensifying.
The drop off of community giving from racial groups leaves a gap in help where those in need, without local organizations, must now wait for larger foundations to supply support. The Great Depression proved that as the economy fails to improve, more relief is necessary to assist those who are the least-advantaged, as well as those who harbor some discretionary spending, which they eventually use up when aiding those not as well off as the advantaged populations.
The beginning of a new movement for the growing affluent racial groups is also an opportunity for these groups to distinguish themselves as separate from the traditional philanthropist. Where an economic recession does not mean contributions must follow suit with the decline, but as a mark of progress by the new philanthropists of continuing to donate to individuals and communities even when times are not ideal.
If all philanthropists — traditional, and the new emerging affluent populations of African-Americans, Hispanics, Asian-Americans, and Internet contributors — continued to give as they do in times of economic growth, the need for assistance would be far less overwhelming, and offer an immediate reaction to local suffering, providing philanthropy when and where it is most dire.
Sources:
“About Philanthropy,” The Association of Baltimore Area Grantmakers, 2007, http://www.abagmd.org/info-url2444/info-url_show.htm?doc_id=484188
“Giving and Volunteering Research—National Giving Statistics,” The Center on Philanthropy at Indiana
University, (2010), http://www.philanthropy.iupui.edu/Research/giving_fundraising_research.aspx
(2008), http://www.philanthropy.iupui.edu/Research/CurrentBriefing.aspx
“Survey on Growing Local Philanthropy: Rationale and Methodology,” The Aspen Institute Community
Strategies Group, (2004), http://www.aspencsg.org/rdp/resources/surveys/survey2a.php
Swank, Katherine. “Emergent Philanthropists: America’s Evolving Ethnic Donor Groups,” Fundraising
Success, (May 25, 2010), http://www.fundraisingsuccessmag.com/article/emergent-philanthropistsame...