It’s time we talked about one of the taboo topics of the nonprofit world: the topic of “profit.” One thing I have learned over my career is that if you’re going to have a viable organization, you’ll need to get used to the word. In fact, this is one of the most important concepts that everyone in the organization, regardless of their role, needs to consider in their decision-making process.
At least once a week, we’re asked about compensation trends in the nonprofit world.
It really isn’t surprising. Our Lean Recruitment clients want to hire the best talent they can while retaining as much of their hard-earned resources as possible. On the flipside, senior nonprofit leaders searching for their next opportunity through our subsidiary, AccessHR’s value-job search, want to land a rewarding position and fair compensation as well.
Here are five trends in nonprofit compensation we’ve observed in the past three years. We see these trends in the clients we work with most frequently—national, state, and regional organizations providing vital social and education services to vulnerable children, youth, and families.
1. The Competition Isn’t Regional; It’s National
Currently, the U.S. is both blessed and cursed by a strong national economy. Unemployment has decreased to very low levels, meaning fewer people are seeking jobs; and salaries (especially for senior positions) are increasing. At the same time, the number of nonprofits in existence and their need for highly-qualified employees are also increasing, putting great strain on regional labor pools.
The result? We’re seeing more organizations that could previously fill job openings locally now need to search regionally—or even nationally—to find a strong pool of candidates. And this isn’t just the biggest organizations; it’s small to medium-sized ones, too. Nor is this trend only for new organizations trying to build their brand as an employer;
One of the first subjects I cover with nonprofit leaders when we are talking about business models, strategy, fundraising, or a myriad of other topics, is the difference between customers and consumers. I can’t understate how crucial understanding this difference is to nonprofit leaders. I am not one who touts the "supremacy" of the for-profit world over the nonprofit one, but I do see ways that one sector can contribute to another and this is one where nonprofit executive directors and CEOs can benefit. Having clarity on the difference between customers and consumers will enable you to understand the motivations and needs of some of your most important partners, thereby allowing you to more effectively serve them.