Nonprofit HR departments see rise in influence, not size

HR professionals in the nonprofit sector are becoming increasingly more important to their organization’s operations, even if their relative growth in numbers has remained flat since the recession.

A new study from XpertHR and Nonprofit HR finds that the typical ratio of HR staff to nonprofit employees is 1:66. Meanwhile, despite this low size relative to organizational size, nearly half (49.2%) of respondents say there is a greater recognition of HR among senior leadership; the other half (46.5%) of respondents say their influence has remained unchanged, according to the 2014 HR Staffing, Costs and Structures in the Nonprofit Sector survey.

Lisa Brown Morton, Nonprofit HR president and chief executive officer, explains the C-level is beginning to figure out that investing appropriately in talent and benefits is the right way to go over the long-term.

 “There is recognition that if we hire better we will spend money less inefficiently; it’s a sustainability issue,” Morton tells EBN. The leader of the country’s only HR consulting firm that works exclusively with nonprofits notes that as more organizations see a need for HR, the “vast majority of nonprofits still try to go at it alone and give the responsibility to someone else [that is less-equipped].”

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Budget sequestration as a result of the 2013 lame-duck Congress, was also said to impact federal funding to many nonprofit organizations. Morton notes that the uncertainty surrounding grants and funding is typically not a problem that plagues HR departments because they usually fall within infrastructure and overhead costs structures.

Meanwhile, as 21% of the more than 250 organizations surveyed say the total tally of HR staff has increased, approximately 73% indicate that their HR department size has stayed the same, the study finds.

The Society for Human Resource Management reports similar numbers from its human capital database. The median for full-time HR staff has held steady at 2.0 total HR professionals for both nonprofit and for-profit organizations over the five-year period that ended in 2013. But HR staffing levels at nonprofits grew from an average of 5.3 full-time employees per organization in 2011 to nearly 9 in 2012 and then back down to 8.1 in 2013, indicating relatively flat movement over the years.

The HR function over the last number of years has remained as important as ever, says Michael Pires, VP of HR solutions at ADP, who notes that there has been a surge in complexity within HR role in recent years.

“While most employees are probably happy to have a job, given the economic conditions over the last several years, morale across organizations has generally been declining,” says Pires. “Employees have felt overworked, underpaid. They feel the pressure of what the organization has put on them as a result of slowing down hiring, or filling and addressing the right gaps.”

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Morton believes that the connection between talent and organizational mission has a ways to go in the nonprofit sector. “Benefits is a function of retention, and to the extent that any organization is investing appropriately in benefits it can hopefully attract new talent to an organization and then help the organization to advance their mission,” she says.