Nonprofits: Overhead is Not a Four-Letter Word

I am quite certain that those who scoff at nonprofit salaries after reading salary surveys would be beside themselves if they found out what the average nonprofit professional is paid, not to mention the hours they keep to earn that miniscule sum.

by Shoshanna Jaskoll

Nonprofit salary surveys are evil things. Not only are they often skewed and inaccurate, they always focus on the few CEOs and execs who seem to make outrageous sums of money. No one ever discusses the tens of thousands who work for far less than they should, shouldering far more than should be expected.

Are there some nonprofit heads working within the third sector who are paid beyond what most of us feel is necessary? Absolutely. But they are far from the norm or even the majority. I am quite certain that those who scoff at nonprofit salaries after reading salary surveys would be beside themselves if they found out what the average nonprofit professional is paid, not to mention the hours they keep to earn that miniscule sum.

Thanks to these misleading posts and surveys about nonprofit salaries, the entire sector gets a bad rap and is seen as ‘bloated’, ‘inefficient’, and ‘wasteful’. The irony is that organizations are eating away at their own sustainability because they are so very concerned with budgets, spending, and the perception of them, that they are unwilling to invest in themselves.

It sounds crazy, but it’s true. In the third sector, ‘overhead’ is a four-letter word.

As a result, nonprofits do as much as possible as cheaply as possible (legal advice from a brother-in-law, translations by a friend, etc.) and their professionalism goes down the tubes. This, in turn, results in decreased efficiency overall, the loss of major donations and further struggling.

The fact is that nonprofits need support, love (unconditional love), and to be reassured that they can spend the money necessary to meet their goals … and bring in more money.

When a house is built on the cheap – bad insulation, crummy pipes, subpar architecture – the owner spends the first 10 years (if not longer) preoccupied with fixing the broken elements, from the foundation all the way to the roof. And it’s the owner and those who depend on him who suffer. Had he insisted on the highest quality materials and skilled labor from the very beginning of the construction process, the home would be a sound and safe structure, his family warm and secure within it.

Nonprofits are no different. The basic elements of these organizations – both the materials and the manpower – must be of the highest quality from the very beginning. If not, they will always be focused on plugging organizational leaks and mending their cracked foundations, rather than turning their attention towards growth and the advancement of their causes.

So, it is a big problem when the few who are overpaid within the nonprofit sector are seen as its poster children. Everyone else, namely the vast majority of the nonprofit professionals who are grossly underpaid suffer, and the issues surrounding quality, professionalism and sustainability persist.

Unlike those who feel the answer is to take from the CEO to give to the professionals, I do not believe that is the solution. I don’t think it is reasonable to request that CEOs of nonprofits – who are usually undervalued and unappreciated themselves – hand over a chunk of their salaries to the various employees they oversee.

A far better solution would be encouraging proper and sound investment in those organizations. We must allow nonprofits (read: give them the operational freedom) to utilize the highest quality equipment, services and solutions to make the overall organization more sustainable.

In addition, collaborations between nonprofits should be encouraged and nonprofit professionals should be given quality professional training courses. It would only make sense that private businesses and government offices lend a hand to make this a reality.

We must insist on far more cooperation between the sectors. All businesses and individuals should be supporting their local and national nonprofits, rather than suspecting them.

Yes, transparency is key. But supporters of nonprofit organizations need to stop “nickel-and-diming” them about the services they buy. They must stop asking them to lay a faulty foundation for their homes.

Overhead must stop being seen a four-letter word. Let’s change ‘overhead’ to ‘infrastructure’, and see the perceptions change almost automatically. After all, what donor wouldn’t want to support a strong and sustainable organizational structure that is committed to and capable of meeting its goals?

Shoshanna Jaskoll is the co-producer of AMUTA21C, an annual summit focused on bringing together Israel’s nonprofit and business professionals in an effort to create connections, showcase opportunities, and raise operational standards across the third sector. This year’s summit will take place on Tuesday, June 24 at the ZOA House in Tel Aviv.