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By Katie Warnock
CEO of Staffing Boutique
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America’s nonprofit sector exists to address some of society’s hardest problems: poverty, hunger, education gaps, homelessness, and inequality. Yet there is an uncomfortable contradiction inside that mission – many of the people being asked to improve economic security for others are struggling to achieve it themselves.
Consider two of America’s most expensive labor markets. According to the New York City Department of Housing Preservation and Development, the city’s 2026 affordable housing benchmarks put 80 percent of Area Median Income (AMI) at $95,040, which is considered low income for a one-person household, while 50 percent AMI is $59,400, considered very low income.
Los Angeles tells much the same story. According to the Los Angeles County Department of Regional Planning, the county’s 2026 affordable housing income limits for a one-person household are $93,300 at the 80 percent AMI threshold and $58,300 at the 50 percent threshold.
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These figures apply to affordable housing programs tied to state and federal income limits, but they reveal a broader economic reality: the benchmark for what constitutes a modest income has risen dramatically, while many nonprofit salaries have not.
Now compare those numbers with the realities I have observed over more than two decades working in nonprofit and charter-school staffing. Entry-level salaries around $45,000 remain common among organizations I encounter in these markets.
That means people can spend their days helping families access food, education, and social services while earning salaries that place their own financial security under enormous pressure.
Turnover, Burnout and Additional Recruitment
This is not merely unfair to employees. It is bad economics for organizations. When workers cannot afford to remain, nonprofits pay for vacancies, recruitment, onboarding, and retraining. Remaining employees absorb additional workloads, increasing burnout and creating still more turnover.
What looks like savings on a compensation spreadsheet can become an expensive cycle that ultimately weakens services for the people nonprofits exist to help.
The contradiction is becoming harder to justify as philanthropy continues to grow. Giving USA reported that charitable giving in the United States reached a record $617.2 billion in 2025, crossing $600 billion for the first time and rising 5.7% from the previous year.
The Importance of Charity Workers Not Recognized
The nonprofit culture in America incentivizes donating through tax benefits for high-net-worth individuals, and yet does not reward the employees dedicating their work to the missions.
The problem, then, is not simply whether Americans are willing to support charitable work. It is whether the boards and funders recognize that the people performing that work are part of what they are funding.
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Too often, compensation is treated primarily as overhead to be minimized. That thinking mistakes low spending for efficiency. Staff members deliver programs, build relationships with communities, teach students, coordinate services, and preserve institutional knowledge.
Underpaying them does not magically redirect every saved dollar toward the mission. If it produces chronic vacancies and turnover, it can make the mission more expensive to deliver.
Charter schools illustrate the competitive problem. Nonprofit schools recruit teachers from the same labor pool as public systems that can offer stronger salary progression and benefits. A mission can persuade talented people to accept some trade-offs. It cannot indefinitely compensate for a widening gap between what work pays and what life costs.
Salaries Should Be Mission Infrastructure, Not Administrative Expense
There is another path. Nonprofits can treat compensation as mission infrastructure rather than a regrettable administrative expense. Better pay can improve retention, preserve expertise, and reduce the repeated costs of replacing employees.
Most importantly, it makes it possible for talented people to build careers in service rather than treating nonprofit work as something they can afford only temporarily.
Boards and major donors should make that shift measurable. Every nonprofit should conduct an annual compensation review comparing its lowest full-time salary with local cost-of-living and income benchmarks.
Organizations should establish documented salary progression rather than leaving workers wondering whether today’s starting wage will become tomorrow’s permanent ceiling. Boards should also review retention and turnover alongside traditional program metrics, because workforce instability is ultimately a measure of organizational health.
Funders can reinforce that standard by asking a simple question before celebrating low overhead: can the people delivering this mission afford to live in the community they serve?
A sector devoted to expanding opportunity should not depend on workers sacrificing their own economic security to provide it. Paying people sustainably is not money diverted from the mission. The people doing the work are the mission.
Katie Warnock is the founder and CEO of Staffing Boutique, Inc., a recruiting firm specializing in nonprofit and education organizations.
The views expressed in this article are the writer's own.
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