Study Shows Nonprofit CEO Salaries Rose 2% in 2011

by Linda M. Lampkin, Senior Nonprofit Compensation Specialist 19. September 2013 11:41

 

GuideStar’s recently released study of compensation at 95,000 nonprofit organizations showed small increases for executives in 2011, averaging 2% for CEOs, barely keeping up with the rate of inflation. Before the 2008 recession, increases averaged 4 to 6%, but had been much lower for the past several years.  GuideStar analyzed the 2011 compensation data of about 135,000 executives in 14 job categories reported on the IRS Form 990 and prepared tables that show median salaries based on organization size, type, and geographic location.

Additional analyses covered the issue of pay differences by gender (GuideStar reviews the names and assigns a gender to those that are typically used for males or females).  The data show that while the number of women executives continues to grow, they are typically paid less than their male counterparts in organizations of all sizes.  More details on differences in compensation between men and women can be found in this Chronicle of Philanthropy article. The gap is shrinking but at a very slow pace.

Some highlights include:

  • The pay gap is largest at organizations with budgets of $5 to $10 million, where women leaders are paid 21 percent less than men. The smallest gap was at groups with budgets of $250,000 or less, where women are paid 9 percent less than men.
  • There were fewer women leaders at the largest organizations; for example, females headed only 16% of the organizations with budgets over $50 million. That percentage is over 50% for organizations with budgets of $1 million or less.
  • Washington, DC’s nonprofit executives had the highest median salary—$152,676—of the top 20 largest urban areas in the report, while Portland, OR had the lowest.
  • Science and technology organizations had the highest median compensation, with leaders of religious organizations at the bottom among the types of organizations analyzed.

Different tables in the report show median compensation by some geographic locations, by budget range, and by broad type of organization.  However, nonprofit boards setting compensation for their top level executives may need much more detailed information to determine what is being paid for similar jobs in similar circumstances.  ERI’s Nonprofit Comparables Assessor allows the user to easily calculate average competitive compensation levels, selecting characteristics that determine pay levels so that the list of comparable organizations can be limited to those that are relevant.  The researcher can choose from a wide array of types of organization (from broad categories to very narrow) and choose a geographic area (from national in scope to zip code) and choose a specific size, not a budget range (and that size can be based on revenue or assets, whichever is most relevant).  This ensures that truly similar organizations are included in the analysis.  Access to the source documents for the data is only a click away so verification is simple.

The analysis provided by the Nonprofit Comparables Assessor is the kind of data that the IRS wants nonprofit boards to use when making compensation decisions.  In fact, the IRS and various state charity regulators use this same software to aid in their determinations of what is reasonable compensation.  Download the free demo version.