In 2022, the U.S. nonprofit sector saw a 1.7 percent decline in total giving, a 10 percent drop in the number of donors, and a 3.5 percent decrease in retention rates, a report from Independent Sector finds.

Based on data from 2021 through the second quarter of 2023, the report, Health of the U.S. Nonprofit Sector: Annual Review (21 pages, PDF), found that while roughly 90 percent of the drop in donors was among those giving less than $500 annually, the number of major ($5,000 to $50,000) and supersize (more than $50,000) donors also fell by 3.1 percent and 2.1 percent, respectively.

Top reported nonprofit sources of revenue in 2022 included individual donations (32.1 percent), program revenue (19.5 percent), government funding (19.4 percent), and foundation and corporate grants (15.3 percent), followed by other income (6.6 percent), dues (6.1 percent), and investment income (1 percent).

The report also highlighted the decline in public trust in the sector, with 52 percent of the public indicating trust nonprofits to do what is right, down 7 percentage points from 2020. Only 39 percent of survey respondents who said their personal financial situation was “getting worse” trusted nonprofits, compared with 67 percent of those who said it was “getting better.” According to the report, only 31 percent of nonprofits reported engaging in advocacy or lobbying in 2022, a significantly smaller percentage than 20 years ago, despite 90 percent of the public supporting nonprofits educating policy makers on communities.

In addition, the report found significant compensation and workload disparities within the sector, with 48.5 percent of nonprofits reporting increasing staff workloads to meet rising demands for services in 2023. Although nearly two-thirds of nonprofit employees over the age of 25 hold a bachelor’s degree or higher, nearly 20 percent struggled to afford basic necessities in 2021.

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