News and analysis
September 16, 2013

CEO Salaries Rose 2% in 2011, Says Study

Pay for nonprofit chief executives continued to inch upward in 2011, after years of holding steady during the downturn, according to a new study of pay at 95,000 organizations.

The median increase for all chief executives was 2 percent in 2011, compared with 1.6 percent in 2010. But that uptick, which barely kept pace with inflation, still represents a more sluggish pace of growth than the typical 4- to 6-percent increases nonprofit leaders typically received before the recession hit in 2008.

“Nobody feels the economy is growing great guns, but it is growing again,” says Chuck McLean, vice president for research at GuideStar and author of the study. “When things start to look a little better, people are going to say, 'I want more money.’”

The report by GuideStar, which collects financial data that nonprofits file with the Internal Revenue Service, is based on payments reported on 2011 informational tax returns The data show the pay of some 135,000 workers in 14 job categories, including top fundraisers and financial executives.

Gender Gap Persists

In addition to examining pay levels, the report also looked at the differences in compensation between men and women. While the number of women leading nonprofit groups is steadily growing, their salaries continue to fall short of their male counterparts’ pay at organizations of all sizes.

Nonetheless, the gap is shrinking compared with previous years, says Mr. McLean, albeit “really, really gradually.”

The largest inequity is at groups with budgets of $5-million 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.

Women hold a small share of leadership jobs at the largest organizations. While women hold the majority of top jobs at groups with budgets of $1-million or less, only 16 percent of groups with budgets above $50-million had female chief executives in 2011, an increase of only 4 percent in the past decade.

Board members, who often hire chief executives, need to do a better job of making sure women are not shortchanged, says Judith Lichtman, senior adviser to the Partnership for Women and Families.

“There are plenty of objective resources that board compensation committees can look at to ensure that they are paying their women leaders fairly as compared to male leaders,” she says. “If they are serious about attracting talented women, they have got to make the workplace a family-friendly place, but they also have to be very clear about how they are setting salary and benefit packages.”

Washington Pays Most

Among the study’s other findings:

• Female development directors at organizations with budgets of $10-million to $24.9-million were the only top fundraisers whose median pay outpaced that of their male peers. Those women made a median of $134,367 in 2011, compared with men who made $129,627.

• Top fundraisers at nonprofits with budgets from $250,000 to $499,999 earned the biggest median pay raise of all positions surveyed: a median of $40,000 in 2011, a 6.6 percent increase from 2010.

• Chief program officers at groups with budgets from $25- to $49.9-million received the largest pay raises for that job title. Those officials made a median of $145,756, an increase of 3.9 percent from 2010.

• Directors of finance, operations, and marketing who worked at organizations with budgets of $50-million or more saw the biggest median pay hikes for those positions. Finance directors at those groups made a median of $235,743 in 2011, up 3.6 percent from 2010; chief operating officers made $262,613, up 4.9 percent; top marketing officials made $196,233, up 5.2 percent.

• For the eighth year in a row, executives in Washington had the highest median salary—$152,676—of the top 20 largest urban areas in the report. The Portland, Ore., area had the lowest, according to the study.

• Chief executives at science and technology organizations had the highest median compensation. At the bottom rung of the pay scale were leaders of religious organizations.

Copies of 2013 “GuideStar Nonprofit Compensation Report” are available in a variety of formats at prices ranging from $349 to $1,449. Go to the GuideStar Web site.