We Need to Talk about Nonprofit
Job Quality More
“When I was a nonprofit Executive Director in San Francisco in 2017 I made $80,000. Raising my salary wasn’t a priority for me; it would mean more fundraising and funds were better spent elsewhere. But that also meant I wasn’t prioritizing others’ salaries. Two brilliant staff, a BIPOC woman and gender-expansive folk who I hoped would eventually lead the organization were facing a promotion without appropriate compensation. What’s more, those staff had been participants in our programs years before. They embodied leadership with lived experience. I was not only wronging those staff, but our mission, as we were funneling our youth into a trap: mission-driven values-aligned work that would not pay their bills and allow financial autonomy in adulthood.” — Pui Ling Tam
The nonprofit starvation cycle threatens organizational sustainability and indirectly constrains the sector’s impact. But it also hurts the very people who make nonprofits run.
Too many nonprofit jobs lack family-sustaining wages, necessary benefits, worker protections, and advancement opportunities. Instead of enabling economic security, for many, a nonprofit job means sacrificing personal economic security and, in some cases, physical and mental well-being.
This is self-defeating for philanthropy. As a sector we endorse greater support for other essential occupations like healthcare workers and teachers, yet we are silent when it comes to nonprofit workers. We need to start talking. No matter your philanthropic strategy — from economic justice to climate change to the arts — your work depends on the well-being of nonprofit workers.
Here’s why it matters:
It’s about racial and gender equity
In the Bay Area alone, the nonprofit sector employs close to 800,000 workers, who are predominantly people of color. In San Francisco, 75% of nonprofit workers are people of color and low-wage nonprofit workers are disproportionately Black or African-American. Nonprofit jobs remain some of the most accessible to people of color; yet unlike public sector jobs with strong unionization, nonprofit jobs do not provide a path to economic mobility. To the contrary, under-compensation of nonprofit jobs perpetuates racial and gender inequity.
The nonprofit sector needs to recruit and retain talent
Nonprofits take on monumental tasks, like repairing centuries of harms inflicted on people of color, women, and gender expansive people. This work is deeply personal, often relying on individual workers’ hard-earned wisdom gained from decades of experience. It is also hard, under-resourced, and surprisingly thankless. At the same time, organizing wins are driving job quality improvements in other sectors, threatening to widen the gap between private sector and nonprofit employment. This forces brilliant young people and nonprofit professionals alike to choose jobs that pay a living wage over working for social good. With turnover in nonprofits almost double that of other sectors and leaders reporting an acute shortage of talent, this limits organizational capacity and nonprofit (and thus philanthropic) impact. If we want the best and brightest in our communities to join or stay in the nonprofit sector, we must stop expecting people to either have generational wealth that can subsidize their nonprofit career, or that the (often, but not always) rewarding nature of nonprofit work justifies struggling to make ends meet.
The massive sector needs to focus on quality jobs
For some workforce development funders, quality jobs are the name of the game. As foundations, we fund a long list of tools that tend to focus on job access in key sectors. But that work seldom focuses on nonprofits, despite the fact that the sector is the country’s third largest and contributes $1.5 trillion to the economy.
Conversations and early pilots to increase job quality are underway, but progress is not linear. Wage compression, or the decrease in the difference between higher salaries and lower salaries, can leave more senior staff feeling undercompensated. In addition, when one philanthropic funder or stream of government funding raises wages, it can lead to the same role having two different salaries based on funding source alone, eroding equity across the organization.
How we’re moving from words to action
These are real challenges, but addressing big problems is what this sector does. Here’s some initial steps we’re taking to address them with real action in support of nonprofit well-being:
- At Irvine, in Better Careers’ updated strategy, our support of direct-service organizations focuses on those who are led-by and accountable to the communities they serve and who use workforce development as a tool for repair. We are beginning a year-long listening process to understand from leaders and staff what we can do to support better quality jobs. We fully expect that this means our grants will have to be larger and that we will have to choose fewer grantees and potentially serve fewer people in the near-term as a result. We believe the tradeoff is worth it.
- At ReWork the Bay, a community-led funder collaborative, our funder partners learn from community-centered, participatory grantmaking practices through our ReWork Philanthropy initiative. ReWork the Bay is also partnering with Irvine on a participatory research and capacity building effort to advance philanthropy’s understanding of the needs of client-facing nonprofit staff related to job quality and professional development, and identify and share practical strategies to better address those needs.
- At the Walter & Elise Haas Fund, we launched the Endeavor Fund, a commitment of seven years-long general operating grants of $3.5 million each to seven organizations. We were transparent with potential grantees that we cared about two things: how they are closing the racial and gender wealth gap, and how they support and increase nonprofit well-being. We understand that it’s our job to amplify what the seven nonprofits are learning, trying, and building, from the mistakes to the possibilities, so that others — other organizations and other funders — can learn and act alongside us.
And we’re standing on the shoulders of tremendous work of nonprofit leaders. Fund the People and All Due Respect have been part of leading the charge around this work, and we’re pleased to be partnering with them in 2024 to host a convening on this topic. We will bring together funders, nonprofits, supporting organizations, and government leaders to share experiences and think through balanced approaches to progress.
We hope you will join us by adding your voice to this urgent conversation and taking concrete action. Whether you come to the convening or start a conversation with your grantees or funders about what you need to advance job quality in the nonprofit sector, this work requires all of us.