Charitable giving in Canada is at a crossroads. According to Statistics Canada, fewer Canadians are donating to charities than ever before. This past year marks the lowest number of Canadians making donations (17.1% of Canadians) since 2002. In addition, the total overall amount donated has dropped for the first time since 2016. Canadians have a reputation for generosity and helping others. Our prosocial behaviour is a mark of pride. This trend in charitable giving does not reflect our reputation as Canadians.
This is not to say that Canadians aren’t still digging in and supporting charities; they are, even in the difficult financial times we have been experiencing. However, the data shows an overall decline in contributions and contributors. At the same time, more Canadians are relying on charitable services for their daily needs. This growing demand and reduced donations put charities in a difficult position. Let’s look at what’s causing this decline and what it means for Canadians.
Factors contributing to the decline in giving
Economic pressures
Many Canadians are facing financial hardship, which makes charitable giving less feasible. The rising cost of living, inflation, and increased levels of personal debt have stretched Canadians’ budgets to the limit, leaving less room to consider donating to charity. The aftermath of the COVID-19 pandemic has only made matters worse. Despite supportive measures like $10 a day daycare and reduced telecom prices, many Canadians still struggle to make ends meet.
When a family’s priority is paying for essentials like housing, groceries and utilities, charitable giving often takes a backseat. Adding another expense to an already tight budget is enough to raise a person’s blood pressure, and we all want to stay in good health. However, even when it is not in our immediate self-interest, helping others makes us feel good—that is why so many Canadians still choose to donate, even in our current economic climate.
Social and demographic changes
Canada’s changing demographics could also be contributing to the decline of charitable giving. Older Canadians are more likely to donate regularly because giving has been a long-standing habit. However, Canada’s population is getting younger, and the younger generations tend to approach giving differently. For many millennials and Gen Zs, charitable giving isn’t as big a part of their daily lives as it was for their parents and grandparents.
Religious affiliation is another significant factor. Historically, Canadians who attend religious services have been among the most generous donors. Those who participate in weekly services are 15% more likely to donate to charity. However, religious affiliation in Canada has been steadily declining—from 90% in 1985 to just 68% in 2019. Doing good things like giving is a practice many religions follow. As fewer Canadians identify as religious, the associated culture of giving may also be fading.
Trust, transparency and access
Trust in charitable organizations has become a larger concern in recent years. Many Canadians may hesitate to donate because they are unsure how charities use their money. With large charities, it’s often unclear how much of the donation will go to those in need versus overhead costs, leading to mistrust. A 2021 survey found that less than half of Canadians trusted charitable institutions.
The rise of direct and decentralized options, such as sites like GoFundMe and Kiva, has also changed charitable giving. These platforms allow donors to give to individuals or causes, leaving traditional charities out of the loop. Many Canadians find these platforms appealing because of their transparency. Donors can see who their money is helping and how much of the donation makes it to its target. While this trend has benefits and helps reach individuals with support, it also means less funding for established charities with large-scale community programs.
Implications of reduced charitable giving
Strain on charitable services
Even if you don’t rely on charitable services, you likely know someone who does. Charities provide crucial support for vulnerable Canadians. Charities help run food banks, shelters, mental health services, and disaster relief, among other things. Some provide access to clean water and health benefits in rural communities. With fewer donations, many charities struggle to meet the rising service demand. If this trend continues, some charities will shut down. This will leave gaps in the support system that many Canadians depend on during tough times.
Food banks across Canada have reported record-high usage in recent years. Many Canadians also reported having to use food banks for the first time. However, without enough funding, food banks may be unable to provide food for those in need. Similarly, as homelessness becomes a more visibly significant issue in many cities, shelters may have to turn people away due to a lack of resources.
Hunger and homelessness are just two of the issues charities tackle. Although these issues are not always visible, their impact on communities can be profound.
Impacts to the community
Reduced charitable giving impacts individuals who rely on these services and entire communities. Charities fill gaps left by government programs and provide essential services that help people survive difficult times. When charities struggle, the burden can shift to public systems already stretched thin. Charities help lighten the burden on healthcare and social services, which would become even more overburdened without them.
No one plans to utilize charitable help. When you need to rely on charities for support, it can be a big hit to your self-esteem and pride to ask for help from someone else. When charities are there to help you, it’s like an invisible hand reaching out to lift you from a dark moment. To give you a chance to get up, dust yourself off and take the next step forward without shame. Imagine if there was no charity because of insufficient funding to keep the doors open. The impact on our communities would be widespread.
Additionally, the nonprofit sector is a significant part of Canada’s economy. This field employs hundreds of thousands of people across the county. A decline in donations can lead to job losses in this sector, further affecting local economies.
Why giving matters
Charitable giving is about more than money. It’s a way to support your community and help those who are most vulnerable. Whether it’s homelessness, hunger, or mental health, charities address critical needs that impact us all. Whether you help by donating your time or giving money, every little bit helps. Even small amounts can make a big difference when combined with the efforts of others.
How Canadians can help
While the challenges are considerable, there are ways to support charities even during tough times. Here are some simple steps Canadians can take to make a difference:
- Donate what you can: Even small donations add up. If you can’t give money, consider donating food, clothing, or school supplies. You can also challenge friends or family to a no-spend month and donate the savings.
- Volunteer your time: Many charities rely on volunteers to run their programs. Donating your time is often just as valuable as a financial contribution.
- Support local causes: Smaller, local charities often directly impact your community. Supporting these organizations can create meaningful change close to home.
- Match when you can: There are times when big organizations offer to match donations within a specific timeframe up to a certain amount. Take advantage of these opportunities. They are a good way to make your dollar go even further.
- Champion transparency: Look for charities with detailed financial reports and clear impact statements. Many organizations are improving their transparency to rebuild trust with donors. Take a look at their business plan or press releases to learn more.
- Educate yourself and others: Share the importance of charitable giving with friends and family. By raising awareness, more people will notice and, hopefully, take action.
Final thoughts
Charitable giving in Canada is at a crossroads, but it doesn’t have to stay this way. Canadians can help reverse this trend. Now you understand some factors behind the decline. You can take action to support the charities that make our communities stronger. You can help by making donations, volunteering, or spreading the word. We all have a role in ensuring charitable organizations can continue their work. Let’s make generosity a part of our everyday lives and support the charities that help us all.
