• October 31, 2014

Nonprofit Leaders Saw Their Pay Stall Again in 2010, Study of 77,000 Groups Finds

Paycheck 091312 Enlarge Image
close Paycheck 091312

For the second year in a row, a large share of nonprofit chief executives saw their pay either stagnate or decline in 2010, a new study finds.

The struggling economy was a key reason 41 percent of chief executives reported flat or lower compensation from 2009 to 2010, according to the study.

“That’s a pretty astonishing number,” said Chuck McLean, vice president for research at GuideStar and author of the study.

The median increase in salaries for nonprofit CEO’s hovered at 1.6 percent in 2010.

The report by GuideStar, which collects financial data that nonprofits file with the Internal Revenue Service, is based on payments reported on 2010 returns by more than 77,000 tax-exempt groups. The data reveal the pay of some 116,000 workers in many job categories.

The share of chief executives who received no pay increase is about the same as in the previous year but remains far higher than in the three years before 2009, when an average of 28 percent of chief executives reported stagnant or declining pay, according to Mr. McLean. And pay increases were typically much larger than the 2010 median, he said.

“Before the recession, it was routine to see year-to-year increases in the 4- to 5-percent range,” he said.

Large organizations provided increases in 2010 that were slightly higher than the percentage gain in 2009, while groups with budgets of $1-million or less tended to provide smaller increases in 2010 compared with 2009, the study found.

Pay Gap for Women

Female chief executives continue to earn less than their male peers at organizations of all sizes. But the report found that the gap is continuing to narrow at many groups.

Female executives realized larger increases in compensation at bigger organizations, where they hold fewer chief-executive positions. Median increases declined at small nonprofits, where women hold more of the top jobs.

The gap between median chief-executive pay for men and women was 10.4 percent in 2010 at organizations with budgets of $250,000 to $500,000, compared with 17.8 percent in 2000. For organizations with budgets of $50-million or more, the gap was nearly 25 percent in 2010, compared with 45.6 percent in 2000, the study found.

Despite progress at many groups, female leaders faced a setback at groups with budgets between $1-million and $10-million. For instance, at groups with budgets of $5-million to $10-million, the gap was 20.6 percent in 2010, compared with 15.9 percent in 2000.

Women continued to increase their hold on chief-executive positions across all categories of nonprofits, the study found. Their representation, however, decreased as an organization’s budget increased.

At organizations with budgets of $250,000 to $500,000, women held 59 percent of the top jobs, up from 54 percent 10 years ago. For organizations with budgets of more than $50-million, women held 17 percent of CEO positions in 2010, up from an average of 14 percent in 2000.

“In the decade from 2000 to 2010, women made gains in the percentage of CEO positions held at every size of organization,” the report said. “As has been the case in the past, however, their representation still declined steadily as organization size increased.”

Christianne Corbett, a senior researcher at the American Association of University Women, said those results are in line with longtime trends.

“I’m disappointed, but I’m not surprised,” she said. The gender gap exists due to longstanding preconceptions among men and women about the executive roles women can perform, Ms. Corbett said. To break those biases, she said, nonprofits need to do a better job of training the managers who handle promotions.

Among the study’s other findings:

• Executives in Washington had the highest median salary—$151,872—of the top 20 biggest urban areas in the study. The Denver area had the lowest, according to the report.

• Chief executives at science and technology organizations had the highest median compensation, followed by leaders of health, medical research, and “public/societal benefit” groups.

The 2012 GuideStar Nonprofit Compensation Report can be purchased online for $349. Go to: guidestar.org/compensationreport.

Send an e-mail to Doug Donovan.

  • 1255 Twenty-Third St., N.W.
  • Washington, D.C. 20037
subscribe today

Raise more money and increase awareness with trusted insight.