Charity Donations Among Small Business Employees are on the Rise

Workplace giving (e.g., employee donations, matching gift programs, volunteer hours) is becoming an increasingly important differentiator for businesses of all sizes and especially small businesses. Workplace giving programs enable organizations to collectively contribute to charitable causes and community projects, enhancing the social responsibility of companies and helping to address local or global challenges. 

Gusto Giving is a tool within Gusto’s payroll environment that allows employees to support charities they care about by donating directly from their paycheck and their employers to match those donations. Currently celebrating its 10th anniversary and over $2.4 million donated, we took a look to see what trends are taking place amongst employee and employer giving today. 

Key Findings

1. Charitable donations among small business employees have been on the rise since 2020 and the Covid-19 pandemic. Since January 2020, donations among small business employees have risen 83%. 
2. Company matching is also on the rise among small businesses. There has been an 84% increase since January 2020 in companies matching their employees’ donations. 
3. The more money a person makes, the less money they donate as a percent of their total income. Lower income employees donate .07% of their income while high income employees only donate .02% of their income. 
4. GenZ is donating, on average, as much of their income as their Millennial and GenX counterparts. This is despite making 34% less money than Millennials and 37% less money than GenX. 
5. The average employee donation is roughly $25. Over $2.4M has been donated through Gusto Giving in the last 10 years. 

Charitable donations among small business employees have been on the rise since 2020 and the Covid-19 pandemic.

The summer of 2020 brought on a groundswell of social justice activism and calls to action for various causes around the country. 

As a result, charitable donations among small business employees spiked in 2020 and have remained at elevated levels ever since. Small business employees are donating 83% more money now than they were in early 2020 (Jan. 2020 to January 2024). There has also been a 15% increase in the number of employees who are choosing to donate since 2020. 

Company matching is also on the rise among small businesses.

Many companies expanded CSR initiatives during the pandemic, encouraging employees to participate in donation-matching programs or charity campaigns. As a result, we have seen an 84% increase in companies matching their employees’ donations. 

December is the month that sees the most company matching throughout the year, with December 2021 being the month with the highest levels of matching – a 16% increase from December 2020. And while numbers have ticked down over the last 2 years, they still remain up from pre-Covid levels. 

The more money a person makes, the less money they donate as a percent of their total income.

Notably, almost one in four (22%) donations were made by lower income earners (<$50k). Low-income employees also donate a larger percentage of their income (0.07%) compared to medium (0.03%) and high-income earners (0.02%). This suggests that the more money a person makes, the less money they donate as a percent of their total income. Low income employees donations made up about 7.5% of total donations through Gusto Giving. 

GenZ is donating, on average, as much of their income as their Millennial and GenX counterparts. 

Gen Z is highly attuned to social and environmental issues, such as climate change, racial justice, and mental health, which drives their desire to contribute to meaningful causes. They are also digitally fluent, making charitable giving easier and more visible.

As a result, GenZ donors are donating just as much of their income as the older two generations (all donating about 1% of their income, on average). This is despite making 34% less money than Millennials and 37% less money than GenX. 

Over $2.4M has been donated through Gusto Giving in the last 10 years. 

The average employee donation on Gusto Giving is $25, up from $18 in 2019. Since Gusto Giving was established 10 years ago, over $2.4M has been donated to charities across the globe. 

The top 10 charities donated to through Gusto Giving are as follows: (1) Equal Justice Initiative (2) American Civil Liberties Union Foundation (3) Bay Area Women’s and Children’s Center (4) Team Rubicon (5) The Against Malaria Foundation (6) Clear Fund (7) Friends of the Israel Defense Force (8) African Hospitality Institute (9) Planned Parenthood Federation and (10) One Acre Fund.

Conclusion 

Workplace giving is an important way that companies can engage current and future employees and show care and consideration for causes that may not directly impact them. The societal crisis caused by the combination of the Covid-19 pandemic and George Floyd’s murder generated widespread calls for action and renewed attention to inequities and injustice. As a result, we’ve seen an increase in both the number of employees donating to causes they care about and the amount of money they are donating. 

Gusto Giving was launched 10 years ago so that employees could easily make one-time or recurring donations. This Giving Season, while celebrating $2.4 million donated through Gusto Giving, we wanted to thank all of Gusto’s customers and their employees for meaningfully contributing to charities and causes that aim to make our world a better place.