What Nonprofit Burnout Looks Like from the Funders’ Point of View

Earlier this month, the Center for Effective Philanthropy released a “Research Snapshot” report that’s unique within the discourse around nonprofit worker burnout. Rather than focusing on the problem through the lens of nonprofits — as CEP itself did with the May launch of its “State of Nonprofits 2024” report — the snapshot focuses on funders. The report has its limits, but its results point to some troubling if not surprising conclusions about foundation inaction in the face of widespread nonprofit burnout and hiring issues.

The report’s results are drawn from a 2023 survey of 283 U.S.-based health conversion, corporate or community foundations that each provided $5 million or more in grants during the most recent year financial information was available. The majority of the funders support educational nonprofits (74%) while the rest of the majority (53%) work in areas including the arts and human services.

The small sample size means that, at present, it’s only possible to draw preliminary conclusions about the state of foundation support for the overall wellbeing of their grantee partners’ workforces. Still, its data points to a sector that is at least waking up to the realities of nonprofit burnout: 70% reported feeling concern about the burnout level of “some” or “most” of their grantees.

But even among funders that are aware of the issues, that awareness is adding up to very little action: Only half of the surveyed foundations said they were “engaging in practices to support the wellbeing of staff” at their grantees; of this 50%, just 5% reported supporting wellbeing for all of their grantees. Seventy percent collectively supported wellbeing for “some” or “a few.”

Fifty-nine percent of the funders provided wellbeing capacity-building grants, but in the main, the offered supports came without additional funding: Foundations asked staff about their wellbeing during check-ins, provided knowledge about wellbeing practices, and made third-party services available to assist nonprofits with staff wellbeing.

Tight organizational budgets are a well-known root cause for burnout in the sector. “Almost everything that leads to burnout can be traced back to money,” said Rebecca, one of the organizers of the Crappy Fundraising Practices LinkedIn page, who asked that her last name not be used. “Even things like contentious employee relationships can often be traced back to having to fight for resources, or just learning everything in a culture of scarcity.”

An important caveat is that CEP itself didn’t focus on economics as a primary factor in workers’ wellbeing. Instead, it defined “wellbeing” as “the state of employees’ mental and physical health, influenced by factors such as workplace relationships, organizational culture, pace of work, and staff engagement and empowerment.”

All of these factors, of course, are heavily dependent on a nonprofit’s ability to hire sufficient staff at high enough wages to create conditions like a healthy organizational culture featuring a sustainable pace of work — and, at many nonprofits, that ability is likewise heavily dependent on funders.

CEP research analyst Seara Grundhoefer told IP that the report is based on research conducted for a wider report that also didn’t address worker pay and benefits. Additionally, she said, the funder survey was conducted before CEP had the nonprofit data featured in its May report. While this is a valid argument from the standpoint of a research organization seeking to compare apples to apples with its data from different research projects, it’s also true that information about the impact of low wages and salaries in the nonprofit workforce has been widely available since the National Council of Nonprofits first reported on the nonprofit hiring crisis in 2021.

Grundhoefer, one of the co-authors of the larger May report, said the group is very interested in exploring these questions in future research.

One funder, at least, wishes that the report had centered workers’ economic wellbeing. “I was surprised that the definition of wellbeing didn’t include compensation, benefits and paid time off as part of the definition,” said Walter & Elise Haas Fund Executive Director Jamie Allison. “For those who work in the nonprofit sector, it is true that we experience a sense of pride and purpose in our work. Those good feelings can lead to a sense of wellbeing. However, pride and purpose must be accompanied by living wages, benefits and paid time off in order for nonprofit workers to experience holistic wellbeing.”

The Haas fund and Allison have been pushing other funders to provide grants that stipulate paying nonprofit workers living wages and providing workplace benefits since at least 2023 — words that they’ve backed with actions, including by establishing the Endeavor Fund, which rewards grantees that prioritize workers’ wellbeing (defined to include wages and benefits) with seven-year, $500,000 general operating support grants.

Caveats about its sample size and definition of employee wellbeing aside, CEP’s June report is still valuable because it covers nonprofit worker burnout from the funding side — a first in the conversation around these issues. Eventually, it’s reasonable to hope that increasing coverage of what funders are (and aren’t) doing to support the workers that depend on them to serve their mutual missions will result in actions that go beyond expecting ever more of a sector that is already stretched too thin.

In addition to nonprofit working conditions, Dawn Wolfe’s beats include LGBTQ and abortion rights; criminal justice; racial justice issues; efforts to reform philanthropy, and funding for nonprofit tech. You can reach her at: dawnw@insidephilanthropy.com.

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