Trend Spotter: Investing in staff and your nonprofit’s future

By Joanne G. Carman and Richard M. Clerkin

Attracting and retaining talented staff is essential for the nonprofit sector. In North Carolina, however, nonprofit organizations report that they are continuing to have a hard time hiring qualified staff and maintaining competitive salaries during these lean budgetary times. Because nonprofit organizations are so busy trying to manage immediate staffing challenges, they are failing to invest in longer-term retention strategies, succession planning, and other human resource management needs.

This may prove to be problematic in the future, as many nonprofit organizations begin to experience retirement and turnover, according to the 2013 Nonprofit Employment Trends Survey, a national survey of 588 nonprofit organizations conducted by Nonprofit HR Solutions of Washington, D.C., with assistance from the Improve Group of St. Paul, Minn.

In this fifth survey of Trend Spotter, a special project of the Institute for Nonprofits at NC State University, we asked small North Carolina nonprofits with budgets under $600,000 to tell us about their staffing and recruitment plans for the next year. Seventy-seven nonprofit organizations completed the survey, which was conducted around the July 4th holiday. With the exception of just two of the responding organizations, all of the nonprofit organizations reported that they currently had paid staff to support the work that they do.

When we asked about their specific staffing plans for the next year, approximately one quarter of the respondents indicated that they did not have any plans to create new positions, freeze hiring, eliminate positions, or gradually reduce staff. For these organizations, the plan is to simply maintain the status quo for the next year.

While 30 percent of the respondents indicated that their organization planned to freeze hiring, the good news is that almost 40 percent of the respondents indicated that their organization might create new positions within the next year. And, less than 10 percent of the respondents reported that their organization might eliminate positions or gradually reduce staff within the next year. These relatively positive findings are consistent with the national data and trends reported in the 2013 Nonprofit Employment Trends Survey.

The respondents to the Trend Spotter survey, however, described how staffing their nonprofit organization continues to be fraught with some major challenges.

Hiring qualified staff within budget constraints was the most frequently identified challenge for these nonprofit organizations, with almost half of the respondents identifying this as being “significantly challenging” and the other half identifying this as being “somewhat challenging.”

“Our greatest challenge is probably our budget constraints, which prevent us from hiring all the staff we would like or need,” stated Andrew Rodgers, executive director of RiverRun International Film Festival in Winston-Salem. “As a result, staff members end up doing a lot of the ‘other duties as assigned’ sort of things that are so common in low- and medium-budget nonprofits.”

Others also echoed this concern that budget constraints were preventing them from being able to hire qualified staff or pay staff what they “deserve.”  Rural nonprofit organizations, in particular, reported having a hard time with this.

In addition, when it comes to hiring staff, the survey respondents identified issues relating to “finding the right fit.” Not only is it hard to find qualified personnel to work at “low,” “sub-standard” or “moderate” salary ranges, but respondents also described that it was hard to find staff that fit with the culture and needs of their organization. As one person noted, finding qualified staff members who embrace the organization’s mission and vision with passion was among that organization’s greatest staffing challenges. Others described challenges with finding “quality” staff, staff to work specific hours, or staff to fill certain positions.

Several survey respondents described how the inability to provide a strong benefits package (i.e., medical insurance and retirement benefits) also can deter “good prospects.” When we asked if their organization had a benefits package for their employees, only about half of the respondents indicated that they did.

Nonprofit organizations seem to place a higher value on offering a flexible work environment, in that almost all of the survey respondents noted that their organization offered a various opportunities (i.e., flexible hours, generous vacation benefits, or personal days). Few respondents reported that their organization had formal employee retention strategies, formal succession plans for executive leadership, or staff dedicated to human resources functions. Even fewer respondents considered staff retention to be a significant management challenge.

Again, these findings were consistent the 2013 Nonprofit Employment Trends Survey, which finds that most nonprofit organizations are failing to invest in retention strategies or succession planning. The authors caution that “individual nonprofit organizations, and the sector as a whole, may begin to lose highly skilled experienced employees in the years ahead” as baby boomers retire or leave the nonprofit sector.

The challenge for today’s nonprofit organization is figuring out the balance between short-term and long-term staffing needs. One Trend Spotter described how her organization is managing this by conducting a needs assessment and taking a careful look at staff positions and salaries. Another  described how her organization provides support for educational opportunities for staff through the American Society of Association Executives, along with job restructuring in order to ensure that employees are provided with an interesting and challenging array of work responsibilities.

Other resources to help nonprofits address these management issues are available through consulting firms. Locally, education and training opportunities are provided by the N.C. Center for Nonprofits.

Joanne G. Carman is an associate professor in the Political Science and Public Administration Department at the University of North Carolina-Charlotte. Her teaching and research focuses on program evaluation and nonprofit management, and she is the coordinator of the Graduate Certificate in Nonprofit Management.

Richard M. Clerkin is Interim Executive Director of the Institute for Nonprofits and an associate professor in the Public Administration Department at NC State University. His teaching and research focuses on philanthropy and management and he is the director of the Graduate Certificate in Nonprofit Management.

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