How the U.S. Economy Is Affecting Church Giving

Tracking church giving trends

As retail stores hope the holiday shopping season gives their bottom line a lift, American Protestant pastors are less sure the economy is helping their congregation this year.

Around 2 in 5 pastors of Protestant churches in the United States (41%) say the economy is having no impact on their church, according to a new survey from Nashville-based LifeWay Research.

The rest are nearly split on whether the effect is positive (30%) or negative (26%).

“Fundamentally, the U.S. economy is in a similar place that it was a year ago,” said Scott McConnell, executive director of LifeWay Research. “Yet pastors are less optimistic about this outside influence on their church than they were in 2018.”

While the 30% of pastors who believe the economy is having a positive impact is more than triple what it was in the first part of this decade, it’s down sharply from the 45% who felt the same way in 2018.

The percentage of pastors who feel a negative impact from the economy increased for the first time since 2010.

After falling in every survey from a high of 80% in October 2010, the percentage jumped from 14% in September 2018 to 26% this year.

African American pastors are the most likely to say the economy is having a negative effect on their congregation (49%), while white pastors are the most likely to see a positive impact for their church (33%).

Pastors of the smallest congregations, those with fewer than 50 in attendance, are most likely to say the economy is having a negative impact (37%) and the least likely to say it’s having a positive one (17%).

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OFFERINGS UP OR STABLE

Whatever the economic climate is outside the church, around 3 in 4 pastors say their offerings this year have been at or above last year’s.

More than a third (37%) say their church’s giving has been up so far this year. The same percentage (37%) say it has been the same as 2018.

Close to 1 in 5 (21%) say their offering totals are below last year’s levels.

Those numbers are not as strong as in the 2018 LifeWay Research study when 42% of Protestant pastors said their offerings were above 2017, 37% said giving was the same, and 15% said it was below.

“Last year was the first year in which many Americans had lower withholding levels because of tax reform,” said McConnell. “It’s not surprising that fewer churches are seeing year-over-year growth in 2019 without a similar stimulus to their congregants’ take-home pay.”

Larger churches are more likely to see increased giving from 2018. Half of churches with 250 or more in attendance (50%) say offerings are up this year. Forty-two percent of pastors of churches with attendance of 100 to 249 say the same.

A third of congregations with 50 to 99 in attendance (34%) have seen an increase in 2019, while only a quarter of churches with fewer than 50 (25%) have seen a similar uptick.

African American pastors are again the most likely to see a negative financial picture in their congregations. More than a third (36%) say their giving is below 2018, while 22% say the offering is above last year.

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About half of all Protestant pastors (51%) say their total offerings in 2019 have been about what they budgeted, while 23% say they have been higher than budgeted and 23% say lower.

Last year, 48% said giving was similar to the budgeted amount, 29% said offering exceeded budget, and 19% said it was lower than budgeted.

PASTORS SAY TAX REFORM LACKED IMPACT

More than 3 in 5 pastors (64%) say they don’t think the 2018 tax reform had any effect on their church’s finances.

Similar numbers believe the changes negatively impacted their congregation (14%) as the pastors who say they’ve seen a positive impact (12%). Around 1 in 10 (11%) say they’re not sure.

When asked in 2018 as the reforms were being implemented, pastors were slightly more optimistic. Half (49%) said they didn’t expect any impact, but 26% thought they would see a positive effect on their church’s finances.

This year, pastors of larger churches, those with attendance of 250 and more, are more likely to say the tax reform has positively impacted their congregation (20%) than pastors of churches with 50 to 99 in attendance (10%) and those with fewer than 50 (7%).

“There are no signs the 2018 tax reform created continued income growth for churches,” noted McConnell.

First published on LifeWayResearch.com. Used by permission.