The question of whether or not nonprofit employees should be working at market rates has the effect of immediately drawing sides in a debate that can get downright unpleasant. While it’s not a new subject, it is one that deserves more attention, especially in the context and culture of China’s burgeoning NGO sector.
GreenTV (in Chinese) reports that the average starting salaries for entry level positions for college graduates in Chinese companies is RMB 2,500/month (US $370; presumably in major cities). Within three years that salary often more than triples to RMB 8,000 (US $1200). For NGO employees, their starting salaries may be as low as RMB 1-2,000 (US $150-300) and rise to RMB 2-3,000 (US $300-450) in the same amount of time.
When great workers who are passionate about their job and the social good they can do can’t keep their heads above water financially, it can lead to high turnover rates, limited efficiency and effectiveness. Ultimately, it is the community that suffers. What needs to happen to improve the quality of work and workers in NGOs–not only in China, but worldwide?
You get what you pay for
Higher salaries do not automatically equal better employees, but the old adage is true—you get what you pay for. Often, people want to give directly to causes or projects. That isn’t a bad thing at all, but it raises the question—if all the money goes to the cause, who is going to grow the organization? Some organizations come with the caveat that a certain percentage of all donations go to overhead costs, but many, knowing that donors may be put off by it, don’t.
It might be more constructive to look at the issue of donating directly to salaries as a means of building into the most important resource in a nonprofit—the employees. Lily Qu of Shanghai United Foundation asks, “If staff are underpaid, how can they be motivated?” Lily says that, among the nonprofit workers she knows, none will leave a position due to the salary alone, but she acknowledges, “I cannot accept anything lower than my current salary because of the high living expenses in Shanghai.”
The best and the brightest
Who are we missing out on by keeping nonprofit salaries low? In the US and increasingly in China, many recent college grads are attracted to the nonprofit sector. The problem is that they don’t last long and that the students from the best schools are often dissuaded in joining the nonprofit sector because of a lack of innovation, development and benefits.
As single 20 somethings, new grads have the freedom to work for low wages and few benefits, but when they start a family it is difficult to maintain a salary that grazes minimum wage. In China, nonprofits can rarely afford to give their employees more than the most basic health insurance.
A higher calling
In China, there is a deep mistrust of how money is used in charities and many assume there is some level of dirty dealing going on somewhere. A lack of transparency is partly to blame for this, but also a misconception (held worldwide) that people in charities should earn small wages. The result is that people rarely give to either salaries or overhead costs.
There seems to be a cultural standard in the East and West that over glorifies those in nonprofit work as long-suffering, self-sacrificing altruist pillars of goodness who therefore should be content to subsist on low wages. Should charity work determine a certain lifestyle?
An argument has oft been posed against raising nonprofit salaries for the fear of attracting people who want to make money rather than support the cause. It’s a very valid point, but also one that should be dissected since good deeds often don’t qualify as currency in our global society. But, are we devaluing the job by providing such low salaries? We may need to adjust our view of social work as a service rather than a charity. That doesn’t mean taking the heart out of it at all, but actually valuing the work of these well-educated people who, regardless of pay, sacrifice a lot for the good of the whole.
Before we can get to this point in China, it will require a change in how nonprofits are viewed. As in other countries, China’s nonprofit workers are dedicated to their work because of the greater good it does. Donors who are sensitive to the issue can do their part by contributing to building up the infrastructure of organizations now and then so that organizations will be around for the foreseeable future thereby allowing them to continue with their commitment to impacting the community.
There are two things I want to emphasize. First, nonprofit workers in China are very dedicated to the sector. Huang Kaipeng, founder of the Green Ribbon Organization admits that there is a high turnover rate in NGOs, but low salaries are not the only cause and, “even though people change their jobs, they are still in the NGO sector.” Second, I am not advocating for blindly increasing salaries. Where salaries (either too high or too low) are preventing an organization from accomplishing its social mission, then the compensation needs to be evaluated. As blogger Owen Barder suggests, “we should pay higher salaries whenever the return—in terms of higher output from securing better staff—exceed the costs.”
More money to salaries and overhead doesn’t necessarily mean better management, organization, or impact, that is up to the staff. Every situation is different and there’s no blanket “fix”. The ultimate question we should probably be asking ourselves as donors is one put forth by Dan Pallotta (a controversial character on this subject), “What will most quickly allow us to eradicate poverty?” And can we truly be strategic, impact-driven donors without addressing this issue?