More talent in the sector? Change the economic equation.

No, this does not mean pay more. (necessarily)

Before I explain, let me ask the fundamental question, why do we work in the non-profit sector? Why do people work in the for-profit sector? What it comes down to is the following economic equation:

Monetary Compensation + Benefit package + Intrinsic Benefits – Costs >= Desired Utility

People will work for an organization when this equation holds true. Intrinsic benefits could be feeling good about one’s self, being part of a team, working to forward a mission, cache, or a number of other things. Costs could be time spent at work, distance to work, etc.

So what does this tell us about recruiting and retaining talent to the non-profit sector? Well, as Matt and I can both tell you, we’re not here because the monetary compensation and benefits package are substantial. We’re both here because of the intrinsic benefits we receive. We’re still here because these benefits are substantial. But for many, the benefits go down over time as the ‘allure’ of the sector fades, or the cost of not always being able to see the fruits of one’s labor, lack of professional development opportunities, etc.

So what’s the solution? We don’t have an answer…

But by understanding the problem correctly, we hope to create innovative ways for fundamentally changing this economic equation so the the social sector can retain and recruit the talent it needs to be more effective and reduce turnover costs.

-Dave