The 2015 Nonprofit Employment Practices Survey™ from Nonprofit HR heralds a growing nonprofit sector that is quickly outpacing the for profit sector. Now the third largest employer in the U.S. with nearly 2 million organizations, the nonprofit sector employs 10.7 million people and has revenues in excess of $1.9 trillion.
With a reported 50% of nonprofits anticipating creating new positions in 2015, compared to just 36% of private companies expecting to increase their staff size in 2015 as reported earlier by Career Builder’s U.S. job forecast — it appears that nonprofits are positioned to make a significant impact on the economic recovery in America.
“I’m excited by the growth of the nonprofit sector outpacing other industries. This study and the results can raise visibility for the sector in a new way,” said Lisa Brown Morton, SPHR, President & CEO of Nonprofit HR.
“But,” she says, “I temper that enthusiasm with the readiness there is to take that growth on.”
From a uniquely HR perspective, one can see that there is more to hiring—and then sustaining—a happy workforce. For example, clarified Brown Morton, “There is the level of sophistication of the recruitment and candidate experience, competing with corporate organizations, perfecting employment branding…” and so much more that the nonprofit sector has to consider as it grows.
Here at the Unemployment Services Trust, where much of our perspective in helping nonprofits is on the flip side of hiring, when employees separate, it’s easy to see how the entire hiring experience, job satisfaction, training, and growth opportunities all play a part in being able to retain staff and lowering turnover long term.
While few nonprofits plan to eliminate positions (7%) or gradually reduce staff (4%), more nonprofits are seeing a rise in voluntary turnover, i.e. quits.
Why? “Inability to pay competitively” was the top retention challenge (27%) reported by nonprofits. “Inability to promote” (20%) and “excessive workloads” (19%) were also top rated issues. If you work for a nonprofit these might not be all that foreign to you. But the real question we posed to Ms. Brown Morton was, “What is one thing you think nonprofits could do better to retain staff?”
Hint: The answer wasn’t simply “a $2 raise.”
“Make retention a priority. Pay attention to why people leave and collect data that will help you understand how to retain staff,” directed Brown Morton. “Then take definitive, intentional steps to address those problems.” So whether it’s an HR person, Executive Director or other operational person collecting the data and leading the charge, finding the root of retention problems has to be an organizational directive.
A Shift in HR Focus
While the last couple of years have seen a big focus on succession planning in the nonprofit sector, the coming years will be more focused on “talent, culture and engagement,” predicts Brown Morton.
She points out that the discussions around leadership development are leaving a big part of the nonprofit workforce out of the conversation. There is only one leader – so we need to focus on talent at all levels and how to engage and retain them.
If your nonprofit is wondering where to spend its budget in an effort to increase retention, Brown Morton says, “If you have to choose, I would say the thing to invest in is hiring more people. This helps increase diversity on your staff, and new perspectives and solutions can be developed in response to the issues your organization faces. It also diminishes the burden on existing employees by spreading out the workload, which helps prevent them from wanting to leave prematurely due to stress.”
In all, keeping employees on board isn’t just about higher pay—it’s about engagement and connection to their work, she explained. Even if you can’t provide growth such as immediate career advancement, you can help your employees follow their passion, which means they’ll be more engaged.
Said Brown Morton of their objective at Nonprofit HR, “We just encourage nonprofits to continue to pay attention to talent issues in 2015.They will find their missions advancing faster than those that don’t.”
UST will be covering more trends and insights from the 2015 Nonprofit Employment Practices Survey on our blog so stay on the lookout!