Valuing Volunteer Time
Valuing Volunteer Time

The engine of volunteerism purrs along day-in and day-out engaging millions of Americans in hands-on work to make their communities better. Ben Franklin started it way back in 1736 with the first volunteer firehouse and today almost every nonprofit is buoyed by hours of unpaid time contributed by committed do-gooders. 

“Volunteerism is engrained in our nation’s history and psyche,” said Barbara Floersch, grants expert and author of You Have a Hammer: Building Grant Proposals for Social Change. “When we’re concerned about an issue, our instinct is to put on the yoke and pull whether or not we get paid for it.”

Volunteers can enhance an organization’s reputation and reach, but the value of unpaid labor eclipses those more subtle benefits. Volunteers provide billions of dollars of free labor every year. Without them many nonprofits would have to curtail services or even close their doors. “The clean-up project could not pay all the people out on the road picking up trash. There’s no way a nonprofit could cover that tab,” said Floersch.

The cash value of volunteer time is a double win for nonprofits. The free labor provides muscle for the work and also helps organizations win grants. Funders often require applicants to match grants with non-grant resources, and many funders accept in-kind resources to meet that requirement. The value of volunteers can be the pivotal piece that makes the proposal budget work. 

For years The Independent Sector has used U.S. Bureau of Labor Statistics data on private sector wages and benefits to establish an annual rate at which nonprofits can value volunteer time. It’s an established, respected estimate that nonprofits can use to publicize the value of community support, recognize the people who contribute their time, and meet the resource matching requirements of grants. 

The most recent data are available at https://bit.ly/3XiW13E providing state-by-state breakdowns (yes, labor in New York is more expensive than in Mississippi) along with historical data showing how the value has increased since the previous report. For example, the rate in New Jersey is $32.39 per hour, a 3.1% increase since 2020.

While the Independent Sector rate will be appropriate for most volunteers, the rates can be legitimately higher for others. For example, if a New Jersey pediatrician volunteers to cover the clinic at your summer camp, you can use the average hourly rate paid for similar work which is around $100 per hour. 

“If you use the value of volunteer time to meet a match requirement for a grant proposal, be sure to follow the rules of the road,” said Floersch. The volunteer role must be necessary to the proposed project. The time must be tracked on a time sheet, signed by the volunteer, and kept on file. The time must be appropriately valued for the labor provided.