Employee Turnover: Why It’s Bad for Donor Retention

Melissa White
January 15, 2020


Employers are facing a tough job market right now. With low unemployment rates, the market heavily favors candidates and employees over organizations. A whopping 3.6 million employees voluntarily quit their jobs in July 2019, the highest number on record since April 2001.

Employees are becoming pickier about the jobs they’re applying to and interviewing for, and are more open to jumping ship for opportunities that appear to be greener. 

For nonprofit organizations, it can be even harder to retain talent, as the pay is usually lower than that of for-profit organizations, and nonprofit work, while rewarding, can be physically and emotionally draining. 

The top area for turnover in nonprofits is in positions in direct services, followed by fundraising and development. How well nonprofits address turnover is paramount to their overall success.  

For nonprofits, as with most organizations, there’s a carryover effect from employee satisfaction to donor and client satisfaction.

Turning the Tide: Ways to Retain More Employees
(and Donors)

Employees and volunteers who are happy and engaged are less likely to leave your organization, which means less turnover. Engaged employees are more likely to go the extra mile for clients and community partners, which translates to better donor retention, customer loyalty and profitability.  

A revolving door of employees or volunteers can cause those relationships to fray - we all like seeing friendly, familiar faces, and your donors and community partners are no exception.

Additionally, here’s a few more ways that high turnover can impact your organization...

  • Having a stable staff can result in more knowledgeable, competent employees. Novice employees tend to make more mistakes, which can be costly to your bottom line.
  • Less turnover equals higher levels of productivity. It can take six months to a year for a new hire to get up to speed, whereas a long standing employee can fire on all cylinders, easily producing at 100+%. By having a fully-ramped team, you’re able to accomplish much more.
  • It decreases cohesion and could cause other team members to leave. When employees have worked together for a long time, they form a cohesive bond, making co-workers feel more like family. It takes time for new relationships among team members to form, so when a replacement comes aboard, collaboration and communication can be stunted. 
  • Time spent recruiting, sourcing, interviewing, and training is time spent away from the mission, event planning, raising awareness and fundraising. You only have so much time in the day - if you have a fully functioning staff, you’re able to focus on the key needs of the organization.

We’ve covered some ways that turnover can harm your organization, but what can you do about it? When it comes to turnover, an ounce of prevention equals a pound of cure. 

Read on for a few changes you can make to improve staff retention and reduce turnover: 

  • If you can, offer competitive wages. People join nonprofits for the mission, not necessarily for the money, but it's still important to make sure they’re paid equitably. Do a quick salary search for similar jobs in your area and check out what the market is paying. Aim to pay at least average. 
  • If you can’t pay competitively, offer some good perks. The ability to work remotely, a generous PTO policy, or payment for continuing education are all great perks. Offering an employer match on 403(b) accounts is also a good idea, especially if you incorporate a vesting schedule that encourages employees to stay for several years before earning the employer-matching portion. 
  • Focus on people development. By developing in-house talent, and expanding and deepening your team’s collective experience, it creates a win-win for employees and the organization. Also, ownership begets engagement, so if you can let employees “take it and run with it” they become more invested in the outcome. 
  • Give kudos and recognition for good work. Acknowledgement and praise (publicly and privately) increases motivation and creates a positive work environment. Give out spot bonuses, gift cards or other incentives when it's warranted, and make sure others take notice.
  • Focus on company culture. Orchestrate team get-togethers and events, celebrate when goals are met, or allow for employees to blow off steam during happy hours. Encouraging social interaction amongst employees, especially from different departments, can result in stronger work relationships. It’s important to hit goals and metrics, but who says you can’t have fun in the process? 
  • Hire the right people the first time. Clearly outline job expectations throughout the interview process, use behavioral interviewing techniques, and question candidates about short stints in employment. Hiring for cultural fit is also important - by aligning the interests of your prospective employee’s with the mission of the business, they’re more likely to stay long term and feel fulfilled. 

At the end of the day, your organization is only as good as the people running it. If your employees and volunteers are happy campers, you can save a lot of time, money and resources on having to recruit and backfill roles. 

Don’t let turnover jeopardize your organizational goals and mission. By focusing on reducing turnover and creating a happy workforce, you’ll be rewarded with higher client satisfaction, better donor retention, and greater profitability.

First post in series: Employee Engagement: 5 Strategies for Growing Organizations

Second post in series: Drive Donor Engagement by Mastering Employee 1x1s at Your Org

Third post in series: Employee Engagement & Donor Engagement

Fourth post in series: Employee Engagement & Donor Engagement

Melissa White has 8+ years of HR experience, with a focus on recruiting and talent acquisition. She has a Masters in Human Resources and her PHR (Professional in Human Resources) certification.

Topics: Nonprofit Marketing
Get a Salsa Demo

Get a Personalized Demo Today!

Smart Engagment Tools for Today’s Nonprofits

Download Now!