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The impact of the major layoff on non-profit organizations and what to do about it?

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Stephen King is President & CEO of vigorthe leading outsourced accounting and bookkeeping service provider for non-profit organizations.

Nonprofit HRs Survey on Nonprofit Talent Retention Practices in 2021 discovered that 42% of Responding Nonprofit Leaders expected their employee turnover to increase in the coming year, and 80% of respondents said their organization lacked a talent retention strategy.

If you find that your organization is experiencing a churn and you have no intention of reducing the increasing churn, you could be steering your organization in a dangerous direction. Turnover costs are: surprisingly high and can be harmful to the well-being of an organization.

Plus, with limited resources and even government or subsidy-imposed wage rates, nonprofits face greater restrictions. These restrictions can be incredibly annoying when it comes to attracting employees in a highly competitive recruiting environment.

How did the Great Resignation affect nonprofits?

During the pandemic, disruptions in the workplace led to closures and layoffs in both the non-profit and for-profit sectors. After taking the brunt of the pandemic, most leaders expected workers to return to the workplace en masse, but this did not happen.

Instead, workers began to reassess their values ​​to better protect their leisure time and work with a greater sense of purpose, spurring the Great Resignation movement.

To make themselves more attractive and competitive to the top talent, many for-profit companies have adapted to the demands of this newly enlightened and empowered workforce, such as higher wages, better benefits, better work-life balance and remote working options. .

However, nonprofits were already operating with limited resources before the pandemic, and the pandemic only served to further constrain those resources. According to a Salesforce Trend Report 75% of non-profit organizations have seen an increase in the demand for programs while about 68% face declining funding.

As a result, nonprofits have not been able to run as fast. This has resulted in many of them being understaffed and experiencing an even higher turnover rate.

Trends in Nonprofit Organizations: Why Nonprofit Employees Quit

According to the aforementioned nonprofit HR survey, the most commonly reported reasons for voluntary employee turnover were:

• 49% of employees found better opportunities elsewhere.

• 44% invisible career paths (lack of opportunities, career growth or professional development).

• 35% withdrawal or dissatisfaction with the culture or organization.

• 32% benefits and wages.

• 20% personal or family reasons.

• 19% changed career path.

To deal with the high attrition rate that nonprofits face in your own organization, you absolutely must have a retention strategy. It is also important to measure and adjust its impact to continuously improve employee satisfaction.

Five revenue best practices to reduce nonprofit revenue

1. Stay competitive by paying attention to nonprofit hiring trends.

According to a study by UST HR Workforce Solutions (download required)two-thirds of nonprofits expect to add employees to their workforce this year.

If you are one of the organizations looking to hire new talent, it means that there will be a lot of competition. Your salary, benefits, office model, culture, and general opportunities should be attractive to potential employees, especially within the larger recruiting landscape of nonprofit organizations.

2. Consider outsourcing your non-core competencies.

Of course, you probably shouldn’t outsource your nonprofit’s primary activities. But you can outsource anything you’re not an expert at, such as legal services, marketing, customer response management, bookkeeping, and bookkeeping.

Outsourcing is an important problem-solving strategy for organizations trying to work smart with a small budget. You also gain access to industry experts who are the top talent in their respective fields, while avoiding the high cost of hiring full-time employees in-house.

It also helps reduce churn as your employees can focus on the mission instead of focusing on administrative tasks. By outsourcing your non-core competencies, you can devote more time and resources to your mission and advancing your organization’s goals.

3. Focus on employee engagement, culture and wellbeing.

A Gallup poll found that: 73% of disengaged employees were actively looking for other work compared to only 37% of the employees involved.

Yes, working for a non-profit organization offers intrinsic benefits of having a job that has a tangible, measurable and positive impact on the world. However, this intrinsic benefit only goes so far as to keep employees engaged and satisfied. To stay with your organization, employees need a positive work culture, a system of rewards and recognition, and a system of leadership that actively promotes an environment of psychological safety.

4. Provide training opportunities and create clear paths to career advancement.

Another way to increase employee engagement and make employees feel like they are working toward a greater goal (that is, helping employees feel fulfilled by their job) is to create clear career progression paths in your organization. As previously shown, invisible career paths are one of the main reasons employees leave nonprofits and the nonprofit sector altogether.

Training may seem expensive, but it’s smart to think of it as an investment in your people. And if they stop, you’ll probably spend more money to replace them anyway.

5. Hire the right people, not just the best people.

It’s also smart to focus on your nonprofit’s workplace culture and keep it in mind when you hire new staff. Rather than always selecting the individuals with the best credentials or experience, you should choose the individuals who best fit your organization in terms of values ​​and culture.

These people will be more loyal, help you further cultivate the workplace culture you want to create, and won’t leave the moment they receive another sparkling new offer from another organization.

Continuously monitor the turnover rate and success of the retention strategy.

Once you’ve implemented an employee retention strategy, you won’t know if it’s working unless you have the systems in place to track your organization’s metrics.

With a strong back office, you can closely monitor your organization’s productivity, impact, retention rates, and attrition rates to carefully test your existing strategy and the success of any new employee retention strategy you implement in the future.


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