Inflation has driven expenses up for charity groups — while driving donations down

Transcript

JUANA SUMMERS, HOST:

Many charities in the U.S. are feeling doubly squeezed by inflation. It's driving up expenses, and it's also sapping contributions as would-be donors look for ways to cut costs. NPR's Scott Horsley reports.

SCOTT HORSLEY, BYLINE: Cincinnati cabinetmaker Robert Lang doesn't have much in the way of retirement savings. The 69-year-old relies on a part-time job to supplement his Social Security. Lang worries that everything's getting more expensive, from his property taxes to a pound of hamburger.

ROBERT LANG: Our situation is pretty much paycheck to paycheck, although the paychecks don't come that often. You look at your budget, and there are these things you're spending money on. What can you cut back on?

HORSLEY: Lang and his wife have already cut back on restaurant meals and entertainment. He's also cut back reluctantly on helping those who are less fortunate.

LANG: One of the reasons we're here is to help each other out. I'm no great humanitarian, but I feel really good if I can give a homeless guy 20 bucks. And we can't do that anymore.

HORSLEY: And Lang is not alone. The Giving USA Foundation has been tracking charitable contributions for decades. After hitting a record high during the pandemic, Giving suffered a rare decline in 2022, when inflation took off. A report out today shows a modest rebound in charitable giving last year, but Giving USA's chairman, Josh Birkholz, says as a share of disposable income, contributions are still down.

JOSH BIRKHOLZ: When people actually have less money, or they're more nervous about the money they have and the direction things are going, I think things like giving might fall second to buying gas and getting a loaf of bread.

HORSLEY: Overall charitable giving is increasingly propped up by mega-donors, like Michael Bloomberg and Warren Buffett. Birkholz says their contributions are often aimed at solving big systemic problems, while smaller donors are more focused on immediate local concerns.

BIRKHOLZ: The everyday donor is who recognizes someone in my neighborhood is hungry right now, and they just need a sandwich.

HORSLEY: That's the case in south central Indiana, where Julio Alonso runs the Hoosier Hills Food Bank. The organization gets some support from big donors and foundations but primarily relies on small contributions from the six-county area the food bank serves.

JULIO ALONSO: Definitely, the envelopes coming back in the mail with $25, $50, $100 are really the meat and potatoes of our support.

HORSLEY: Alonso worries some of those small donors are feeling worn out or that their own budgets are being squeezed. Contributions to the food bank have dropped by 20% since the beginning of the pandemic, even though the food bank's feeding 15% more people now.

ALONSO: The lines at our food pantries are pretty long, but a lot of the generosity and support that we and other organizations were seeing during the pandemic has dropped off significantly.

HORSLEY: Meanwhile, the food bank's own costs have gone up. It has to buy groceries now to supplement donated food and keep its 10 vehicles gassed up. The food bank's mortgage also reset this year, costing an extra $500 a month. Alonso notes those expenses when he writes to would-be donors, knowing many of them are facing their own financial squeeze.

ALONSO: The need is still very high because of inflation and that we hope you understand that, seeing your own grocery bill, and that if you're able to, you'll support us in trying to support our neighbors who can't make ends meet.

HORSLEY: Charitable giving topped $557 billion last year. Giving USA's Birkholz says Americans are still generous people, even if inflation is a formidable foe. Scott Horsley, NPR News, Washington.

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