Special Report-Nonprofit Paychecks Continue to Climb
February 1, 2001 Paul Clolery
If you’re a planned giving officer anywhere in the United States, but particularly for a foundation, your 2001 paycheck is going to be significantly heavier. The average pay for the top planned giving officer at a foundation is $89,362. And, planned giving professionals at associations will receive the greatest pay hike, 26 percent to an average $57,382.
The holders of many of the top positions at nonprofits, however, will have to settle for moderate 4 and 5 percent raises. And, holders of the top job are seeing raises that are less than the rate of inflation.
These are among the findings from readers of The NonProfit Times who answered a survey form sent during December. Responses from 340 organizations were tabulated into this year’s study. The study sought information on eight positions: president/executive director; chief financial officer; program director; planned giving officer; development director; major gifts officer; chief of direct marketing; and director of volunteers.
All of the categories saw overall increases, from the miniscule 1.2 percent for chief financial officers to the average 11.5 percent for planned giving officers.
The other mean figures were: president/executive director, 1.3 percent; program director, 4 percent; development director, 5.7 percent; major gifts officer, 4.3 percent; chief of direct marketing, 4 percent; and director of volunteers, 4.5 percent.
The national averages projected pay for 2001 for the eight position are:
- President/Chief Executive — $96,715
- Chief Financial Officer — $62,361
- Program Director — $56,862
- Planned Giving Officer — $59,939
- Development Director — $59,220
- Major Gifts Officer — $60,945
- Chief Of Direct Marketing — $52,758
- Director Of Volunteers — $35,285
When breaking the statistics down further, the chief executive job at a cultural organization, on average, brings in the most cash, an average $140,635, followed closely by the bosses at foundations, who will bring home an average $137,496. The top job in the other categories sampled were:
- Education — $114,371
- Health — $108,413
- Civic — $104,530
- Association — $93,738
- Social/Welfare — $85,666
- Government — $81,059
- Religion — $74,504
That pay ranking by type of organization held steady with few deviations throughout the study.
While planned giving officers were by and large in the middle of the salary pack in actual dollars, they are taking home an average 11.5 percent more in 2001 compared to 2000. The next largest increase went to development directors who pulled in an average 5.7 percent pay hike, with average salaries of $62,466 in the Mid-Atlantic region down to $49,617 in the South.
Obviously, size does matter. Planned giving officers at organizations raising $50 million or more will earn an average $89,644, and it ranged down to $26,000 for organizations with revenue of less than $1 million.
The same holds true for development directors. At organizations with annual revenue of $50 million or more, the average salary is $110,390, compared to the $38,346 for the top fundraiser at organizations with less than $1 million in revenue.
Size matters in all categories. For example, the chief executive position brought in an average $212,587 at organizations with more than $50 million in revenue as opposed to an average $61,228 for organizations with less than $1 million in revenue. Another example is the chief financial officer position where the $50 million organizations will pay an average $123,069 compared to the $44,456 to be paid by organizations with less than $1 million in revenue.
Regions also play into the salary mix. A planned giving person in the North Central region of the country will bring in 70 percent more at $64,240 than a similar position in the nation’s heartland.
The accompanying charts illustrate state-by-state how the country was regionalized for the purpose of this study. The charts also have a complete breakdown of salary by position and by region.
There are a few small catches. For example, 85 percent of the organizations polled responded that health insurance premiums had increased and that the average hike was 17 percent. Some 17.6 percent of those organizations said that employees would be picking up a larger percentage of the cost. And, 7.7 percent of organizations responded that benefits would be reduced in one form or another.
Employees can expect to pay an average 22.3 percent of the health insurance coverage, according to the data.
To some extent it’s still a seller’s market, with highly qualified job applicants able to command top dollar. The small rate of increase for the top two jobs may have a lot to do with contracts and letters of agreement that stipulate small raises in exchange for other benefits, such as annuities and vacation time, said David Edell, president of DRG, Inc., a New York City-based professional search firm specializing in nonprofits.
“I think salaries for CEOs and presidents have reached an unprecedented high level. There’s always been some unstated ranges of acceptable salary for nonprofit CEOs and presidents beyond which boards are unwilling to go. The increases are coming in non-salary issues,” he said.
“Additional benefits, supplemental pension plans, additional annuities, vacation, sabbatical and bonuses won’t show up as cash,” Edell said.
He explained that in multi-year contracts the increases are pre-determined so the executives know, by and large, what they will be earning.
If a board wants a particular candidate, price generally isn’t a problem. “It’s been my experience that they do what they need to do to bring the person to the agency,” Edell said.
It’s not unusual in a tight labor market for second tier executives to get a significantly larger percentage increase in pay. “Because there’s always been some disparity between the CEO and next levels and it has always been dramatic, it doesn’t surprise me” that percentages are weighted to the lower levels, Edell said.
A new twist on the payroll scene is the pre-emptive offer. Edell said boards and chief executives are taking a hard look at personnel and making offers to keep them signed-on for a particular length of time, three years for example.
“They are saying what can we do to make it worth your while to stay,” Edell said.
Organizations are also making aggressive counter-offers to keep top staff because of the cost of hiring a new person. He said that often the employee will stay and won’t have a bad attitude about having to field other offers to get a better deal in-house. “Some cases it is just communication problems, ‘why didn’t you tell me you love me’,” he said.
Salaries, despite a near decade-long climb have not peaked, Edell said. “I do think because there is the turnover we are seeing, the market has risen, and there’s a more limited pool of talent.”