Nonprofit CEO salaries
The case for MBAs in nonprofits
Working in the nonprofit sector is both challenging and rewarding. For those prepared to work at a charity, a ministry organization, in world relief, or in any capacity that advances a cause, obtaining a Nonprofit Master of Business Administration (MBA) equips you for the future. With the additional education, you can meet the many challenges facing the world today.
The good news? As reported by the Bureau of Labor Statistics, management jobs for those with the required training are expected to grow exponentially. You can expect 8% growth in the number of management jobs from 2016 to 2026, resulting in 807,300 new jobs overall.
And, after obtaining a Nonprofit MBA, you can expect a salary that is commensurate with your new training level. The reason has to do with how world relief organizations, charities, and ministries view the management role in a nonprofit organization. These institutions — think Samaritan’s Purse, Compassion International, United Way, and many others — understand that management jobs are critically important and the pay should reflect the training acquired.
In fact, according to the BLS, the average income for a management job in 2017 was $102,590, and those numbers reflect a wide array of positions in both the private sector and nonprofits. Those who work in leadership roles in human resources, financial management, advertising, marketing, and the chief executives who lead entire corporations must be fully empowered and equipped to lead others in complex environments, at the expected pay scale.
The variety of jobs available is quite astounding. As the Bureau of Labor Statistics makes clear, the income levels in the six-figure range and running as high as $187,200 for those in upper management fields such as health care, advertising, and purchasing.
The only main distinction to make between the nonprofit sector and private companies is that the organization is classified as nonprofit, identified as a 501(c). However, the job duties performed and training requirements for a financial manager, an executive at a hospital, a marketing director at an ad agency, or one of many chief executive positions such as CEO (Chief Executive Officer) or CFO (Chief Financial officer) match up equally.
That’s why it’s important to understand that the salary ranges are compelling in the nonprofit sector, meant to reflect how these organizations have high standards. Any perception about a nonprofit position in management paying much lower than other management roles is outdated, and those who work in the field know that extra training always means extra income.
As you examine the expected salary for those with a Nonprofit MBA, a good place to start is with the average salary for several management roles. The BLS provides a wealth of information in this regard, detailing several well-known management roles.
For example, a Computer and Information Systems Manager job is highly technical and requires good leadership skills, both for a nonprofit and a private or public business. The average income you should expect is $131,600, with a typical starting salary of $80,160.
A Human Resources Manager can expect a salary ranging from $61,300 on the low end, to an average of $104,440, all the way up to $187,200 on the high end.
Another interesting management role that has a wide salary range is a Medical and Health Services Manager, a role with an expected salary of at least $56,230, the average being $94,500 and a high salary of $165,380.
Meanwhile, the BLS also lists the average salary in 2017 for several other management positions, many of them typically only found at a nonprofit organization. For example, an Emergency Management Director can expect a salary of $72,760. A position as a Social and Community Service Manager will make about $64,100. According to the BLS, a “top executive” or CEO of a company can expect an income of $104,700 on average.
Nonprofit CEO salaries
While it’s helpful to know the salary range for management roles according to the Bureau of Labor Statistics, it’s even more eye-opening to look at the actual salaries for several high-ranking CEOs of nonprofit companies. An average salary range is one thing, but knowing the actual figure can help you understand the job market. In addition, knowing the salary for top CEOs working at nonprofits can provide insight about nonprofit career opportunities.
One example — the CEO of Samaritan’s Purse, a world relief organization known for their Operation Christmas Child shoebox campaigns and health-related work all over the world. The CEO, Franklin Graham, makes $622,000, according to Newsweek Magazine.
Stacey Stewart, the President of United Way, has a reported annual salary of $441,470, according to IRS forms obtained by Paddock Post.
Some of the highest-paid CEOs in the United States include Jonathan Simons, M.D., the President/CEO of the Prostate Cancer Foundation, with an annual income of $1,288,873; Preston Campbell, M.D., the President and CEO of the Cystic Fibrosis Foundation, who makes $957,145 per year; and James DeMint, the former President of the Heritage Foundation, who has an annual salary of $1,398,676, all according to CharityWatch.
Of course, working in a nonprofit is not always that lucrative. The CEO of American Red Cross, Gail McGovern, who leads an organization with international reach has worked under a contract since 2008 with a base salary of $500,000. And the salary range for executives who manage some of the nation’s most impactful organizations — churches, ministry organizations, missions groups, world relief organizations — is much lower.
Nonprofit CEO Salaries Chart
|Samaritan’s Purse||Franklin Graham||$622,000|
|United Way||Stacey Stewart||$441,470|
|Prostate Cancer Foundation||Jonathan Simons, M.D.||$1,288,873|
|Cystic Fibrosis Foundation||Preston Campbell, M.D.||$957,145|
|Heritage Foundation||James DeMint||$1,398,676|
|American Red Cross||Gail McGovern||$500,000|
The case for MBAs in nonprofits
Apart from the expected salary ranges — which are in line with what you might expect in the public or private sector — there’s no question a Master of Business Administration is beneficial to those working in a nonprofit. One of the key reasons has to do with the changing landscape of doing business as a not-for-profit in the today’s world.
Just looking at the healthcare field for example, involves a great deal of business savvy to lead an organization successfully. The Health Insurance Portability and Accountability Act, or HIPAA, was enacted in 1996 and added an increasingly complex set of requirements for those who work in a hospital or clinic. Many hospitals are not-for-profit and have more of a missional mindset — they are seeking the common good for all mankind. Managers and directors in this field must still adhere to all of the requirements and manage these institutions with the same level of care and detail.
Another example of business leadership required in nonprofits has to do with financial management. There are complexities related to government agencies such as the SEC (Securities and Exchange Commission) that require managers, directors, and executives to have a detailed understanding of how a nonprofit organization must be run from the standpoint of financial integrity.
In the computing field, there are many challenges related to security and infrastructure. It seems every day there is a new breach of a high-profile institution, bank, website, or major corporation. The training required to understand the security climate is only going to become more and more complex, and the repercussions for poor management will be more severe.
Overall, the salaries you can expect for a management role once you obtain an MBA are surprisingly in line with all nonprofit, private, and public companies. There’s no question the landscape has changed, and the expectations are that management positions require a more comprehensive level of training and education in all sectors.
One clear example of this is when it comes to the CEO. According to the BLS, the average annual income of a CEO in business today is $175,110, or five times the annual income of a non-management role. Management jobs in all sectors of business pay more.
Another good example — the Principal of an Elementary or High School. With additional education and the required master’s degree for this role, the average annual income is $94,390.
It’s worth noting that the number of jobs available in management keeps growing year after year. According to the BLS, in the field of sales and marketing management alone there will be 172,200 job openings between 2014 and 2024. Similar fields — such as real-estate management, nursing management, and advertising — will see similar job growth.