Things are looking up for the nonprofit industry. Which has its downsides.

Last week, Nonprofit HR released its annual Nonprofit Employment Practices Survey [PDF], which looks at how the sector is doing in terms of staff growth, as well as how well it’s planning for the future in terms of recruitment and retention. As Katie Bascuas reported at AssociationsNow.com following the study’s release, nonprofitdom is growing—last year, nearly half of the organizations surveyed reported an increase in staff size, the largest proportion ever. Growth within associations was more modest, with 37 percent reporting an increase, and only 3 percent saying they’ve cut back.

Our current staff’s salaries are not really in line with the market.

Still, that’s pretty good news, suggesting that, as with the broader economy, nonprofits have largely shaken off the worst of the Great Recession six years after it officially ended. But drilling into the association-specific data in the report provided to AssociationsNow.com, there are some hints of concern that are worth paying attention to.

Consider recruitment and retention. Fifty-two percent of nonprofits overall lack a formal recruitment strategy, and it’s slightly higher (54 percent) among the associations surveyed. And while only 15 percent of nonprofits overall have a retention strategy, the figure is even weaker at associations: 8.5 percent.

The retention issue is more pointed because a better economy means more turnover, as staffers take advantage of a stronger job market to take their talents elsewhere. As the report explains, turnover—especially voluntary turnover—has been on the upswing in recent years, thanks to “employees being more willing and able to leave their positions to retire or pursue new employment.”

What does turnover do to an association? According to the survey, nearly half the associations surveyed said it decreased the organization’s institutional knowledge and increased their recruitment costs. The latter expense is even more crushing if you consider that the next hire will want to work at closer to the market rate. As the report explains, people tend to leave nonprofits because of the relatively low pay, lack of ability to move upward, and general too-many-hats problem. “Our current staff’s salaries are not really in line with the market,” said one survey respondent. “This makes it especially challenging in recruiting new staff at a competitive rate and keeping our integrity on the salary line.”

There is perhaps only so much that an association can do in response to that problem; the report proposes telecommuting as one possible solution, but that may not be practical for many places, particularly those of the too-many-hats variety.
But I’m not sure that associations need a retention “strategy” so much as some common-sense thinking about what it takes to keep talented people. I’ve written in the past about the lack of efforts at nonprofits to support and guide future leaders, but that kind of attention needn’t be exclusive to the C-suite. And it may need to understand the fact that some staffers won’t be at your organization forever—but that they can do great work for you and be more engaged while you have them if you respect their goals.

At least one association that participated in that the survey has given that approach a try: “The CEO talks with each staff member individually about career goals and aspirations, desired responsibilities, etc. The the extent we are able, we attempt to align responsibilities and opportunities to these goals and aspirations.”

At the Stanford Social Innovation Review, Adam Simon echoed this sentiment while writing about his experience training future leaders at the Charles and Lynn Schusterman Family Foundation. “The traditional program that trains everyone on the same set of competencies will not meet the needs of rising stars, does not reflect their professional trajectories, and does not help organizations better achieve their missions,” he writes.

Simon likens his approach to leadership training to Spotify: A suite of options from which people can create their own “personal playlist.” His group puts together peer-led gatherings, immersive training to help participants develop networks, and “micro-grants” to help them gain skills, not unlike professional-development budgets at many organizations.

This kind of individualized attention may seem like an overwhelming expense of time and resources, particularly if the end result of all that care and feeding is a staffer who winds up using the wisdom learned from your benevolence to…go work elsewhere. But if the turnover rate is on the upswing at the moment, a strategy that has employees feeling like they have a direction at their organization isn’t just a way to be generous employees, it’s a way to receive the benefits of engaged employees. And given the expense of recruitment costs and the loss of institutional memory, you can either pay now or pay later.

What is your association’s experience with staff turnover, and what do you do to help retain your best employees? Share your experiences in the comments.

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