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This 1st Charity Sector Salary and Benchmarking survey to gather information on salary, motivation and engagement of staff and volunteers in the UK charity sector 2023. This report presents a summary of the survey's findings and provides recommendations.
In our first crisis assessment (August 2022), we predicted that funding would be the most urgent and most focussed on area, but that wellbeing would be less focussed on but equally important. This has proved to be the case. The triumph of the urgent over the important.
However, our crisis tracking metrics for people, show that increasing numbers of charities are reviewing pay, recruitment and retention. This survey was created to build out our data in this important area and provide ideas and recommendations to help.
Firstly, the bad news. In terms of people feeling that their salary has kept pace with inflation almost all were negative, with nearly a third rating it 1/10.
Almost all staff feel their salary has not kept pace with inflation, some extremely strongly.
A small and informal survey of 22 sector HR professionals in Nov 22 found that most would or had made an inflation pay rise of between 2.3% and 6%; some charities had made no pay increase at all. Whilst inflation is expected to fall,
the Consumer Prices Index …… rose by 8.8% in the 12 months to January 2023,
down from 9.2% in December 2022 (ONS, Inflation and Price Indices).
The real value of charity sector salaries is falling.
And that must also be seen in the context of the existing charity sector wage gap.
‘…… between those working in the charity sector and the rest of the economy, we find the hourly wage gap to be 7.0%
The pay gap widens as people progress through their careers, peaking at 9.4% for those aged 46 to 50. People with higher levels of qualifications experience a bigger difference in their pay than those with lower levels of qualifications, earning an average £40,000 less over their working lifetimes than their similarly qualified peers in the rest of the economy’. Pro Bono Economics, The price of purpose? Pay gaps in the charity sector, Aug 22.
That wage gap is getting bigger.
‘……. growth in regular pay (excluding bonuses) was 6.7% among employees in October to December 2022; for regular pay this is the strongest growth rate seen outside of the coronavirus (COVID-19) pandemic period’. (ONS, Average Weekly Earning Feb 23).
Average national salary increases appear to be already above the maximum salary increases in the charity sector.
Whilst the increases in public sector pay will be isn’t yet known, the recent better economic news means that the Chancellor has potentially significant amounts of funding and unions will no doubt push for pay increases that match inflation. The charity sector wage gap is likely to continue to widen.
The existing charity sector pay gap is getting bigger and will probably continue to do so.
But there was good news too. I'm passionate about our charitable cause – 66% rated this 10/10 with less than 1% rating it 1/10. Within the qualitative feedback provided, people are highly motivated by their charity’s cause and what came through very strongly was that people most valued the difference they make to their beneficiaries and that phrase was used again and again. In terms of their work, I find my role interesting and enjoy my work – more than 40% rated this 10/10 with less than 10% rating it a 5 or lower.
People are huge motivated by their cause and the difference they make.
People also felt they are valued and rewarded for their contribution, not for who they are, or who they know – nearly 60% rated this a 9 or 10, and only about 10% rated it a 5 or lower.
Nearly two thirds feel strongly that they are properly valued and rewarded.
In terms of what charities should do to support and promote their wellbeing, they want to be paid reasonably and treated flexibly, but what came through most strongly was management/trustees listening to them.
People want trustees/management to genuinely listen to them.
Appraisal & Development
Whilst some rated their appraisal and development very highly, at least as many rated it equally lowly, with 20% rating getting constructive feedback and having a personal development plan as extremely poor.
In some charities personal development is rated as very poor.
Career
I expect to still be working for my charity more than a year from now – more than half rated this as 9 or 10/10, but more than a quarter rated it 5 or less and nearly 10% 1/10. In terms of seeing the charity sector as a long term career choice again 50% rated this 10/10, with nearly 10% rating it 1/10.
1 in 10 staff don’t expect to be working in the sector a year from now.
‘…… labour turnover in the not-for-profit sector, revealed it experienced the biggest employment shifts of any sector between January 2021 and January 2022, with a total turnover of 18.1%, including 12.5% of staff leaving voluntarily’. XpertHR, reported by Acevo.
Given the current conditions in the charity sector, I am confident my job is secure – the majority were, but a significant number were unsure and 10% rated this 1/10. Our crisis modelling indicates that we’ll remain at the bottom of the crisis until mid-year, with no significant recovery until 2024, with potentially significant insolvencies.
There is high risk that confidence in job security will deteriorate, possible substantively.
Abuse
And whilst we appear to be beset by endless scandal and abuse, the feedback told a different story. The charity has robust policies on bullying and other unacceptable behaviour – 36% rated this 10/10 with only 25% giving scores of 5 or less. Management ensure no one is discriminated against: women, minorities or others – nearly half rated this 10/10, with only 10% rating it as a 5 or lower. People were also very confident that if they ever felt the need to raise a workplace concern, they would be listened to and also that it would be dealt with quickly and properly.
Nearly half are very confident that their charity ensures no one is discriminated against.
This may seem surprising given the seemingly endless reporting of abuse within charities. Potentially, it may be the Media (quite rightly) reporting these scandals makes them seem more prevalent than they actually are. However, we think it’s more likely to about the survey population. The reported scandals are primarily within larger charities, whereas, the survey is much more representative of the whole sector, most of which comprises small, volunteer run charities. It may well be that abuse is widespread, but only within parts of the sector.
Nonetheless, that doesn’t mean there isn’t abuse, with an admittedly small number of respondents specifically stating that they, or others, were being bullied. The Charity Excellence Big Data shows charities reporting that we perform poorly in having a trustee or committee leading on safeguarding and whistleblowing, including regular reviews of compliance and reports of any breaches in safeguarding practice.
Some charity boards could do more to protect their people.
Overall, our people are hugely motivated, with the single biggest motivator being the difference they make to people’s lives. We could not ask for more than that. They are also largely confident that their work is properly recognised, and they will be protected from abuse; some charities are exceptionally good at this.
However, the single biggest issue is salaries. Inflation should soon begin to fall, but that will reduce the rate at which real wages are being eroded, not reverse it. A very high proportion say they want to stay and make the sector a long term career choice, but there is a real risk they will not be able to afford to do so. Moreover, the existing sector wage gap is increasing and likely to continue to do so. We are almost certain to find it increasingly difficult to recruit new staff and this will push more of our existing staff to leave.
This issue has not been created by the crisis, but rather it has made existing issues significantly worse and is likely to continue to do so. Moreover, because the underlying problems were not created by the crisis, they will not go away, once it fades.
The problem of recruiting and retaining staff may continue to get worse
and is likely to continue into the long term.
The only solution is to pay staff a decent wage, but there are non-financial steps that charities should also take that would make a difference. In addition to the issues reported above, the Charity Excellence Big Data shows that charities are aware of weaknesses in areas such as having an up-to-date, realistic people strategy, or people objectives in the organisational strategy, and a system to monitor progress in delivering these. Above all else, genuinely listen to them.
Charities
Charity boards and management should remain focussed on delivery to beneficiaries, but also recognise that paying staff well and supporting and developing them are critical to continued success. Paying staff a decent wage, including making annual pay increases to reflect inflation, should be a priority. Refocussing fundraising away from securing project funding to more on core funding should be part of that, including considering scaling back activity to accommodate that.
And there is also non-financial support that would help too. We need to:
Leadership is more vital than ever in times of crisis. Now is that time.
Grant Makers & Public Sector Commissioners
But there can be no pay solution, without addressing the huge funding gap. Our crisis modelling predicts no significant recovery in fundraising until the economy recovers and, despite encouraging economic indicators, that may well not be until 2024.
Charity people are hugely motivated, but they can’t continue to work for us if they can’t pay their rent. Equally, the charity sector wage gap will only get bigger. The crisis didn’t create this problem, but it has made it much worse and this now very serious problem won’t go away when the crisis fades. Competition for staff is already fierce and, unless action is taken, we will increasingly struggle to recruit and retain the people who are critical to our continued success.
The only realistic solution is to begin to close the pay gap and that will require funding. Fundraising will not fill that gap in anything other than the long term, if ever. However, there are clear steps that charity boards, grant makers and commissioners could take, that would potentially significantly improve the wellbeing and motivation of our people.
These are a representative sample of the 300+ comments provided.
Salary is below expectation compared to the workload I carryout.
no appraisals no personal development plan
I have been bullied badly….
funding to cover ongoing staffing costs is very difficult to come by, many want to fund innovation and new ideas rather than maintain whats working well
….funding is very difficult to find. Our hard working charity may not be here in six months time.
Making a difference to the lives of others
Because what we do makes a difference and fills the gaps where the government are failing.
Helping those in need
That I am making a difference to people
Look after the staff and pay them reasonably
Listen
listen to them, don't expect them to answer work queries 24/7
Talk to them more. Find out what they need and listen to them. Make changes that support those needs.
Salaries review, benefits for staff
Listen to the community they support be customer led, ensure wellbeing and safeguarding policies are in place
Plan to fundraise in order to pay them decently Talk about ways of working, what is working well and what isn't, what needs to change
Personal development Mental health (if they can't afford pay increases or bonuses, they should offer well being days) Honest conversations about personal development and pay
Listen, from the bottom up. Employ people with lived experience and listen to their stories. Keep learning, from the top down! Communicate better!
Pay proper salaries
some sort of financial assistance as bills go up
Transparency, listening, fairness.
Pay them and offer good terms and conditions. Offer workers co-design opportunities and agency.
Listen and praise them when things go well - all too often people are quick to criticize and forget to say well done. Also flexibility is very important and keeping them involved and informed with everything we do.
Pay the right salary level to retain excellent staff
Training and development opportunities
Encourage healthy work/life balance. Offer competitive salaries or at least benefits if unaffordable.
Flexible working, remote working, ensure people feel valued, cared for and genuinely listened to.
Flexible hours / hybrid working arrangements. Say "no" to additional work / projects which do not provide for additional staff to be recruited. Allow a small number of hours per month that can be taken for wellbeing activities.
Ask them, notice changes, speak to them, involve them.
Listen to people and try to provide what they need.
The survey used the Charity Excellence charity Herzberg 2-factor model to evaluate the key factors affecting employees' job satisfaction, which comprised 50+ questions to score and 3 qualitative questions. The majority of respondents were paid staff in charities of between £100k and £1m. Compared to the sector overall, larger charities (over £3m) were over represented and micro charities (under £10k) very under-represented. There were 150 responses (including 300+ comments), which were augmented with comparative Charity Excellence Big Data, plus a range of other sources.
Plus, 50+downloadable funder lists, 8 online health checks and the huge resource base. Nearly half of our tens of thousands of members rate us 10/10.
