The Correlation Between Annual Giving and Economic Trends

Posted on 01/15/2014

During the 1992 U.S. Presidential Campaign, James Carville coined the phrase “The Economy, Stupid” as one of his party’s core messages.

What the democratic strategist meant was that it’s often the economy, above all other issues, that influences an election. And, in 1992, he may have been right. Bill Clinton went on to defeat George H. W. Bush, whose approval rating declined from 90% to 64% during the recession of the early 1990s.

As fundraisers, we spend a lot of time looking for those things that influence our campaigns. We’re always asking WHY? Did we get the donor’s attention? Did we ask for the right amount? Was our case compelling? These things are, in theory, within our control. But what about those things that are out of our control?

Current Use vs Financial IndicatorsThe above chart (compliments of CAE and Marts & Lundy) shows the trend in annual giving (i.e., current unrestricted gifts) compared to major economic indicators at 50 private research universities over the past decade. One could conclude that there is a correlation between annual giving and the economy.

So what?

There will always be things that are beyond our control – individual moods, institutional scandals, the economy. The truth is that your best chance to influence an outcome has nothing to do with analyzing these things. It does, however, have everything to do with identifying happy prospects, hiring quality callers, recruiting passionate volunteers, articulating a case, demonstrating gift impact, and doing good stewardship.

Focus on the things that are within your control. Focusing on anything else is just, well, stupid.

Want to learn more? CLICK HERE for AGN’s Webinar on Fundamentals of Annual Giving.

AGN Members receive unlimited access to our resources, discounts, and other benefits. Click here to learn more.