Keeping Nonprofit Overhead Cost Low Comes at a High Price

Early indications do not favor the Trump administration throwing more money toward human services. So, it appears that people living in the superpower that we call home are going to rely increasingly on the work of nonprofits. The inconvenient truth, though, is that those doing the good work are being "systematically starved," as highlighted by Jeremy Kohomban of The Children's Village, in a recent article in the Stanford Social Innovation Journal. The habit of undervaluing nonprofit talent undermines the industry's ability to sustainably deliver quality product to those who need help. While the private sector delivers goods and services as well, a lot of those are discretionary—unlike shelter, access to affordable health care, diapers and clothing, and mental health counseling.

So, why is this vital work blatantly undervalued? Why is it that our system pays financial executives, fashions designers, decorators and computer experts well, but so many talented and passionate people working with the underserved are relegated to salaries often below the living wage category? The answer is complex, but one contributing factor, says Kohomban, is that the nonprofit industry is overwhelmingly staffed by women, a group that has long suffered wage discrimination. Another factor, he says, is the stigma attached to nonprofit work due to the "widespread understanding of poverty as primarily a moral and personal failing, rather than a structural issue."