Recession Drives a Surge of Job Seekers to Nonprofit World

JOB MARKET

By Mary E. Medland

With an economic recession causing massive layoffs in the business world and the tragedies of September 11 realigning many Americans’ personal priorities, more and more people are seeking work at nonprofit organizations, according to charity executives and recruiters.

But many charities may find themselves unable to take advantage of the increasing number of résumés they receive because drops in donations and government funds have squeezed the payrolls of many nonprofit groups.

“Without a doubt, we are seeing more résumés and the quality is better than in the past,” says Jennifer Leonard, president of the Rochester (N.Y.) Area Community Foundation. “Part of it is that more people are out of work, but after September 11, there is also a real feeling that people want to follow their dreams. They are realizing that life is not forever and they are determined to do things that are meaningful.”

In the Rochester foundation’s case, a search for a vice president for marketing and development that began in January 2001 but subsequently languished saw an increase in candidates in September that grew significantly in October and November, Ms. Leonard says.

She interviewed many candidates from the for-profit field, she says, and ultimately chose Jeffrey E. Hough, who had left Inkindex, a struggling Internet start-up company that matches corporations with excess inventory to charities in need of donated goods. Although he had been most recently in the business world he was no stranger to nonprofit organizations, having worked previously at Youth Service America, a network of youth-service charities, and the Points of Light Foundation, which advocates for volunteerism.

Finding himself without a job, he renewed his focus on nonprofit opportunities, he says, driven by a search not just for a paycheck but for meaningful work.

“My decision was value-based,” Mr. Hough says. “What is important to me, whether I’m in the for-profit or the nonprofit sector, is doing work that matters.”

The Rochester foundation’s experience is echoed by that of Catholic Relief Services, in Baltimore.

“People are coming to us as a result of layoffs, both in the corporate and nonprofit sector, and we are seeing a more diverse pool of candidates,” says Sherrie Maners, the organization’s manager of recruitment and human resource response.

Nonprofit organizations may be seem like a sensible alternative for job candidates buffeted by the turbulent economy, says Chris Vest, manager of media relations for the American Society of Association Executives, in Washington. “Nonprofits have benefited from their traditional reputation for stability in times of economic flux and are usually a pretty secure profession,” he says. However, he points out, charities and the membership groups that serve them are not immune to belt-tightening measures caused by the recession. At his organization, for example, senior staff members recently agreed to a 5-percent pay cut, and the entire organization is now under a hiring and salary freeze.

A Widening Pool of Candidates

The current surge of interest in working for charities includes not only business veterans but also young people seeking their first jobs after college. Teach For America, which makes almost all of its hires straight from college campuses, is seeing significantly greater numbers of applicants than in recent years. The group, a corps of teachers who commit two years to working for schools in poor neighborhoods, saw applications triple last year in comparison with 2000.

“We’re still getting the good-quality candidates we’ve always had,” says Amy Palladino, acting director of public relations for Teach For America, in New York. Though she attributes the increase in part to more on-campus recruiting and an aggressive, high-profile expansion program, she says that the challenges of the economy and the aftermath of September 11 also play roles: “Young people are rethinking what they are going to do with their lives, both personally and professionally.”

Like older job candidates who have recently focused on nonprofit work, the first-job seekers who are flocking to Teach For America display a renewed sense of urgency, says Monique Ayotte, the organization’s director of admission and assignments. “People not only want to teach, but they truly understand that if they are to live up to the ideals of this country, there is a way to do it within our borders,” she says. “It’s a sentiment that I’ve heard more strongly than previously.”

Nonprofit employers and recruiters say they have received numerous inquiries from people who have had success in the for-profit world. “I think they’re tired of the tension and the insecurity. One moment you have a job and the next you don’t,” says Anne Hyde, president of the Hyde Group, an executive-search firm in Cos Cob, Conn., who says she received about 50 percent more résumés in 2001 than in the previous year. “What I hear is, ‘If I’m going to lose my job, then I’m going to use this moment to take stock of my life.’”

Volunteering at Charities

Not every business professional who ends up in the nonprofit world gets there as a result of layoffs. Many people arrive at charities via volunteering.

“People who begin working for us as volunteers get such fulfillment that they decide this is the kind of work they want to do full time,” says Siobhan Canty, president of Greater DC Cares, the largest coordinator of volunteer services in the Washington, D.C., area. “That happens a lot more frequently than one would think, and that’s how I’ve hired a lot of my staff.”

Volunteerism itself has increased, Ms. Canty says. Since the terrorist attacks, Greater DC Cares has fielded calls from 14,000 people wishing to donate their time to a variety of organizations, nearly three times as many inquiries as the charity received during the same period in 2000.

For former for-profit workers who move from volunteer to staff member at a charity, compensation can be a sticking point. With salaries at charities typically running below those for comparable jobs in business, many job candidates may find the pay cut impractical for them.

But a low salary may not necessarily be a deal breaker. Many relatively young people are able to manage on lower salaries because they have retired early from companies that offer generous pensions, says Michelle McGurk, director of communications for the Community Foundation Silicon Valley, in San Jose, Calif. In her area, she says, many employers that pay less than the business world, such as schools, aggressively recruit early retirees.

Layoffs and Cutbacks

For those who can afford to make the transition, the nonprofit field can be a good interim place for workers who’ve had their for-profit jobs eliminated, says Judee von Seldeneck, chief executive officer of Diversified Search, a recruiter in Philadelphia, because one can do good work and make career contacts at the same time.

For charities, the recession has turned recruitment into more of a buyer’s market, because the increase in applicants has not been matched by an increase in jobs. A few organizations have even laid off workers, including the Freedom Forum in Arlington, Va., the Jewish Community Centers of Greater Los Angeles, a number of museums in New York, Chicago, and Seattle, and many groups in Northern California.

At the Museum of Flight, in Seattle, Craig O’Neill, marketing communications manager, says recruiters are seeing more and better résumés, many from former workers of local technology companies, but right now they can only look: The museum has been under a hiring freeze since the fall, and resorted to its first-ever layoffs this month. The organization gets 85 percent of its revenue from admission fees and is very dependent upon tourism. “Things were beginning to head south before September 11, and then they really dropped dramatically,” Mr. O’Neill says. Museum visits fell 20 percent in October from the previous month.

The Ford Foundation, in New York, eliminated several unfilled positions from its budget when its fiscal year began in October, says Bruce Stuckey, director of the foundation’s office of human resources. The move was in reaction to the decreasing value of the foundation’s portfolio, Mr. Stuckey says, among other economic factors, and planning for it predated the events of September 11. He says the grant-making organization has received an increase in unsolicited résumés, in addition to more inquiries from for-profit executives about making the move into the nonprofit world.

Though the foundation’s portfolio decreased by $3.8-billion from September 2000 to September 2001, says Alexander Wilde, the institution’s vice president for communications, it made more grants than ever last year, for more than $862-million. And it’s back in hiring mode, Mr. Wilde says, with more positions budgeted than are currently filled.

But Ms. Hyde, who estimates that about 20 percent of her clients have laid off workers in recent months, does not see the overall nonprofit job market widening soon. “Most nonprofits are talking about things improving during the second or third quarter of 2002, but it’s not going to improve immediately,” she says.

Others, such as Ms. Leonard, believe that the recession has not hit the nonprofit world as hard as the for-profit one, but they are still eyeing the future warily. “I don’t think the other shoe has dropped just yet,” she says. “Everyone is very hopeful that this downturn in contributions is temporary.”

Regional Differences’

Perhaps no area of the country has been hit as hard as California — especially the northern section, where failures in the technology industry have added to overall recession woes. A survey of 198 Bay Area nonprofit groups conducted this fall by CompassPoint Nonprofit Services, a management-consulting group in San Francisco, found that 11 percent already had hiring freezes in place in response to the sluggish economy, while 8 percent had frozen wages and 6 percent had laid off staff members. An additional 5 percent said they plan on hiring freezes this year, while 6 percent plan to freeze wages and 3 percent plan to lay off employees.

Jan Masaoka, executive director of CompassPoint, says that while she’s been flooded with résumés from former technology workers, she’s also seen many of her group’s clients in Silicon Valley lay off workers in recent months, a trend she says was accelerated by the fallout from the September 11 attacks. “Safety net” health- and social-service organizations that rely on state funds in her deficit-plagued state are particularly vulnerable she says, and she expects that many more charity workers will lose their jobs after the new California budget takes effect in July.

One group that might find itself vulnerable is Shelter Against Violent Environments, in Fremont, Calif., which helps victims of domestic violence. Facing a nearly 35 percent decrease in his organization’s pool of donors, its executive director, Rodney Clarke, is considering laying off some of his 28 employees.

“It’s terrible and very hard,” he says. “Not only are we reducing services to clients, but we are also looking at our staff’s lives as well. We are going through the preliminary steps to see who to keep.” Under such circumstances, he says, he can’t take advantage of the suddenly rich job-candidate pool — even if he had openings, he says, he couldn’t afford to pay them what they expect.

California groups that rely heavily on government money are especially nervous about hiring, according to Ms. McGurk, who says she’s heard from organizations that have recently received warnings from their counties about imminent budget cuts. The result, she says, is that many nonprofit employers are reluctant to take on new staff — only to have to lay workers off in a few months.

But the hiring situation differs in various regions of the country. In Nebraska, where Doug Thompson is resource development director at United Way of Lincoln and Lancaster County, layoffs in the business world have been mostly restricted to manufacturing companies, which tend to employ people without college degrees who may lack the skills to work as a charity manager or be unable to accept the pay cut that can accompany a move into nonprofit work. The United Way in his region has remained organizationally steady though its fund raising has been flat — his group had to scrap its goal of a 4-percent increase in contributions in 2001, instead expecting only to match its 2000 campaign total of $4.7-million. While Mr. Thompson says that his group hasn’t seen a surge in résumés, it hasn’t had layoffs either, though its diminished fund raising will have a trickle-down effect on the organizations to which it provides money. “It will affect other nonprofits in that they will not be able to offer better wages,” he says.

Uncertain times call for people who not only are dedicated to a charity’s mission but who also bring the ability to weather change — and those individuals may or may not be refugees from the corporate world, say some nonprofit recruiters and employers.

Ms. Masaoka cautions that too many of the job candidates she sees from the for-profit world lack a realistic grasp of whether their skills transfer easily to charity work. “All say the same thing: ‘I was working at a really high-paid job and then I realized I wanted my values to be in line with my workplace,’” she says. “They also want to come in at the top of the organization.”

Ms. Canty echoes the notion that an attractive candidate in the business world may not necessarily be irresistible to a nonprofit employer. “We’re looking for talented people, but people who probably have non-traditional backgrounds,” she says. “These are the people who tend to be more creative thinkers and typically bring more skills with them than someone who has been following a single career path for years.”

Discuss the current job-hunting and hiring climate in the nonprofit world on Career Network Connection’s Job Market forum.