Contributions to National Charities Decreasing

( [email protected] ) Oct 30, 2003 09:20 AM EST

WASHINGTON – According to Associated Press, donations to the largest charities have been falling since 2002 for the first time in 12 years because of the economic crisis and uncertainty among donors, a survey finds.

Looking at the result of annual statistics of national charities, it was found that during the previous five years, donations increased an average of 12 percent each year.

But starting last year, donations to the 400 largest charities dropped 1.2 percent to $46.9 billion from $47.5 billion in 2001, according to The Chronicle of Philanthropy's annual survey released Monday.

"This economic downturn has just had so many twists and turns that donors aren't feeling very certain about the future, so they aren't as willing to give," editor Stacy Palmer said. "As donors are feeling more pinched, charities are feeling it, too."

She said the growing number of charities also contributes to the decline, as more organizations compete for donations. In response to the hard times, some charities are changing the way they raise funds, adding staff and sponsoring events to attract donors.

For the first time in a decade, the Salvation Army — with nearly $1.4 billion in contributions — was removed from the top spot. A surge in giving prompted by the Sept. 11 attacks pushed the American Red Cross from ninth to No. 1 last year. With $1.1 billion given to the Red Cross' Sept. 11 fund, the organization's donations totaled more than $1.7 billion.

Charity officials have said their task in 2002 was complicated by many challenges: the waves of layoffs, the stock market plunge, the erosion of trust in some institutions, donor fatigue after the response to the attacks.

Gifts to the top 400 charities accounted for nearly a fifth of the $241 billion given to all U.S. charities last year. Nearly 90 percent of donations come from individuals, Palmer said, with the rest from foundations and companies.