As Economy Revives, Nonprofits Need Better Workforce Planning

By: Patty Hampton

A new survey looks at the recruiting challenges nonprofits face.

Nonprofits expect their voluntary turnover rates to double in 2012, according to the newly released Nonprofit Employment Trends Survey. And since the same survey shows that three-quarters of nonprofits do not have a formal strategy for retaining staff, some organizations may be sailing into danger as the economy picks up steam. Not only may they see their top talent walking out the front door, but they may also be faced with skill and competency gaps, particularly at the entry- to mid-level career mark, that can affect the organization's mission.

The survey, conducted annually by Nonprofit HR Solutions, found that 87 percent of nonprofits do not anticipate their overall turnover rate to increase this year compared to last year; however, more organizations expect turnover through retirements and voluntary resignations to increase. In the midst of a down economy, the nonprofit sector got hit hard. We all witnessed our colleagues, friends, and family members struggle with employment decisions. People who wanted to retire put their decision on ice.

And now that the economy shows strong signs of bouncing back, some nonprofits are demonstrating that they don't know how to get in front of their recruiting challenges. While only 1 percent of organizations expected turnover to increase due to retirements in last year's survey, 13 percent do this year. Additionally, 14 percent of organizations anticipate an increase in voluntary resignations this year, compared to 7 percent last year. While these figures are not overly surprising, placed in parallel with the talent management and retention practices of the nonprofit sector, they should make HR practitioners sweat.

While respondents identified direct services as the functional area that is experiencing the greatest challenges with retention, these same organizations also identified it as the area they anticipate the most job growth in over the next year. It is critical that HR have a retention strategy in place for its entire workforce. No vice president of HR wants to be in the hot seat at the next board meeting when the CEO asks, "How did we let our most important program leaders and top executives resign with no contingency plan?"

It is no longer a secret that top executives and other key staff members are eventually going to leave. Now is the time to put an executive-transition program in place and invest in new leadership development. Future sustainability, capacity building, donor expansion, social innovation, and change are just a few of the areas that nonprofits must fully embrace, develop, and expand.

HR practitioners need an insatiable passion and commitment to moving the organization beyond the realm of possibilities. Workforce planning and driving value and excellence by understanding and communicating trends, metrics, and data are just a few ingredients in organizational development and talent management. The real work begins when the HR practitioner knows how to drive business goals toward extraordinary outcomes—and it starts with talent management. I have no doubt that if the trend is not reversed, missions will suffer, donors will dry up, and nonprofits will continue to dissolve or merge, even if the economy is stronger.

Patty Hampton is vice president and managing partner at Nonprofit HR Solutions. Email: [email protected]

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