Independent Sector Launches New Center to Confront Nonprofit Workforce Crisis

Washington, D.C. – The Independent Sector, a leading voice for the charitable community, has unveiled a critical new initiative: the Center on the Nonprofit and Philanthropic Workforce. This launch comes in direct response to a mounting crisis within the sector, characterized by widespread worker burnout, alarming financial insecurity, and significant challenges in staff recruitment and retention across thousands of organizations nationwide. The Center aims to serve as a vital hub for research, advocacy, and collaborative solutions to bolster the very foundation of the nation’s social safety net – its dedicated workforce.

The urgency of this initiative is encapsulated by a poignant quote from a survey respondent, which resonates deeply with the findings that prompted the Center’s creation: "Bottom line: the folks who work in the sector are the sector." This sentiment underscores the Independent Sector’s recognition that the strength and sustainability of charitable organizations are inextricably linked to the well-being and professional viability of their employees.

The decision to establish the Center was not made lightly. It is the culmination of extensive outreach and rigorous research, spearheaded by Independent Sector CEO Dr. Akilah Watkins. Her comprehensive listening tour throughout 2023-24 revealed a consistent, troubling narrative: nonprofit organizations, regardless of their mission or size, are grappling with profound workforce issues that threaten their ability to serve communities effectively. From the front lines of direct service provision to the strategic offices of advocacy groups, the message was clear – the people driving change are themselves in urgent need of support.

The Genesis of a Critical Initiative: A Journey to Understanding the Crisis

The Independent Sector’s commitment to addressing the workforce crisis began with a systematic and empathetic exploration of the challenges. This journey was meticulously documented, ensuring that the Center’s foundation was built on comprehensive data and the lived experiences of those within the sector.

Dr. Akilah Watkins’ 2023-24 Listening Tour: A Sector in Distress

From late 2023 through 2024, Dr. Akilah Watkins embarked on a nationwide listening tour, engaging with leaders and staff from dozens of nonprofit organizations. The objective was straightforward: to hear directly from those on the ground about the most pressing issues they faced. What emerged was a stark and consistent picture. While specific challenges varied by region and mission, the overwhelming consensus pointed to severe workforce issues.

Nonprofit workers reported struggling with chronic burnout, a direct consequence of heavy workloads, often insufficient staffing, and the emotional toll of demanding missions. Compounding this was widespread financial insecurity, a paradox for individuals dedicated to improving the lives of others, yet often unable to secure a living wage or adequate benefits for themselves. Organizations, in turn, found themselves caught in a vicious cycle: unable to offer competitive compensation or robust support, they struggled to attract and retain the skilled staff necessary to fulfill their missions, leading to further strain on existing employees. These firsthand accounts provided the crucial qualitative data that illuminated the depth of the crisis.

Laying the Groundwork: The 2025 Research Deep Dive

Recognizing the anecdotal evidence needed to be underpinned by robust data, the Independent Sector Research team initiated a comprehensive fact-finding mission in early 2025. This year-long effort was designed to construct a foundational understanding of the nonprofit workforce landscape.

The initial phase involved a detailed review of existing research, programming, policies, and funding mechanisms related to the nonprofit workforce. This included examining academic studies, industry reports, government policies affecting nonprofit employment, and philanthropic funding trends impacting human resources within the sector. The goal was to identify what was already known, what interventions had been attempted, and where critical information gaps persisted. This review was coordinated with other Independent Sector teams, ensuring a holistic understanding of the internal and external factors at play.

Simultaneously, a multi-pronged stakeholder engagement campaign was launched. Over the course of 2025, the Independent Sector connected with nearly 300 diverse stakeholders from across the sector. This included direct engagement with charitable nonprofits of varying sizes and missions, representatives from academic programs focused on nonprofit management, leaders from foundations and philanthropic organizations, and subject matter experts in areas such as human resources, organizational development, and social impact. These engagements were designed to gather more detailed insights into the nuanced challenges faced by both nonprofit workers and their employers, building upon the broader themes identified during Dr. Watkins’ listening tour.

The Nonprofit Sector Workforce Survey (NSWS): A Collaborative Effort (2026)

The rich insights gleaned from the comprehensive reviews and extensive stakeholder engagement proved instrumental in shaping the next critical phase: the development of a nationally representative survey. This survey, known as the Nonprofit Sector Workforce Survey (NSWS), was meticulously designed to capture quantitative data on the state of employment within the sector.

The NSWS was a collaborative undertaking, developed in partnership with esteemed institutions including the Urban Institute’s Center for Nonprofits and Philanthropy, American University, and George Mason University. This partnership ensured the survey’s methodological rigor and broad applicability. Data collection for the NSWS occurred in early 2026, conducted in tandem with the Urban Institute’s long-running National Survey of Nonprofit Trends and Impacts, allowing for potential cross-referencing and deeper analysis.

The survey covered a wide array of topics crucial to understanding the nonprofit workforce, including: organizational demographics, staffing levels, recruitment and retention strategies, compensation and benefits structures, employee training and development initiatives, and perceptions of workforce challenges and opportunities. By gathering data directly from 501(c)(3) nonprofit organizations with at least one paid employee, the NSWS aimed to provide an authoritative statistical snapshot of the sector’s human capital landscape.

Although initially conceived primarily for internal decision-making to guide the Center on the Nonprofit and Philanthropic Workforce, Independent Sector recognized the immense value of sharing these learnings with the broader community. This commitment to transparency and collective impact is rooted in several key motivations: to foster greater understanding of the complex issues at hand, to stimulate further research and collaboration, to inform policy and philanthropic strategies, and ultimately, to empower the sector with the knowledge needed to build a more resilient and equitable workforce.

Unveiling the Core Challenges: A Data-Driven Picture

The extensive preparatory work, encompassing comprehensive reviews, stakeholder engagement, and the initial findings from the Nonprofit Sector Workforce Survey, painted a sobering picture of complicated, interconnected challenges facing the nonprofit workforce. These challenges are not merely operational hurdles; they reflect deeply embedded structural features of the nonprofit sector itself, as well as broader societal issues.

Systemic Roots of the Crisis: The "Passion Tax" and Funding Hurdles

At the heart of many workforce issues lie fundamental structural problems. One pervasive issue is the "passion tax" – the implicit expectation that nonprofit workers should accept worse compensation, fewer benefits, and heavier workloads simply because they are driven by mission. This cultural norm, while seemingly benign, often leads to exploitative conditions, forcing dedicated individuals to choose between their passion and financial stability. It also creates significant barriers to diversity, as individuals from lower socioeconomic backgrounds or those with caregiving responsibilities may find it unsustainable to work in the sector.

Compounding this are inadequate funding models. Long-standing practices such as arbitrary "overhead limits" imposed by funders often restrict organizations’ ability to invest in robust infrastructure, including competitive salaries, professional development, and comprehensive benefits packages. Similarly, inadequate reimbursement rates for services rendered, particularly for government contracts, mean that nonprofits are often expected to deliver essential services without being fully compensated for the true cost, including the cost of adequately paying their staff. These financial constraints directly undermine organizational capacity and perpetuate the cycle of under-compensation.

Furthermore, the nonprofit workforce is not immune to the social and economic systems and biases that affect workers across the American economy. Issues of systemic inequality, racial disparities, and gender pay gaps are mirrored and, in some cases, exacerbated within the sector. Addressing the nonprofit workforce crisis, therefore, requires confronting these broader societal inequities head-on.

Six Pivotal Challenge Areas Explored

Through their comprehensive research and engagement, Independent Sector identified six top challenge areas that are critically impacting the nonprofit workforce. These are presented alphabetically, underscoring their equal importance and interconnectedness:

Diversity, Equity, & Inclusion (DEI): Beyond Rhetoric. While many nonprofits champion DEI in their external missions, achieving it internally remains a significant challenge. This area encompasses issues of representation at all levels, equitable hiring and promotion practices, inclusive workplace cultures, and addressing systemic biases that can create barriers for marginalized groups within organizations. A lack of genuine DEI can lead to higher turnover, reduced innovation, and a failure to authentically connect with diverse communities served.
Employee Well-being & Burnout: The Human Cost. This is perhaps the most visible and immediate crisis. Nonprofit professionals often face intense emotional labor, high-stakes responsibilities, and limited resources, leading to chronic stress, exhaustion, and compassion fatigue. The consequences include diminished productivity, increased absenteeism, and ultimately, a mass exodus from the sector. Addressing this requires not just individual coping strategies but systemic changes in workload, organizational culture, and support systems.
External Instability: Navigating a Volatile Landscape. The nonprofit sector is highly susceptible to external shocks. Fluctuations in funding, shifts in political priorities, and broader economic downturns can create immense instability. This uncertainty directly impacts workforce planning, job security, and the ability of organizations to make long-term investments in their staff, exacerbating recruitment and retention challenges.
Leadership & Organizational Culture: Foundations of Resilience. Strong, ethical, and supportive leadership is crucial, yet many nonprofits struggle with developing effective leaders and fostering healthy organizational cultures. Issues like insufficient management training, resistance to change, lack of transparent communication, and an inability to address internal conflicts can erode morale, stifle innovation, and drive talented individuals away. A positive and inclusive culture is a powerful retention tool.
Pay, Benefits, & Pay Equity: Confronting Financial Insecurity. Directly linked to the "passion tax" and funding models, inadequate compensation remains a core challenge. Many nonprofit salaries fall below market rates for comparable positions in other sectors, making it difficult to attract top talent. Furthermore, disparities in pay based on gender, race, or other factors persist, undermining morale and contradicting the sector’s values of equity. Access to comprehensive health benefits, retirement plans, and paid time off is also frequently subpar.
Retention & Workforce Shortages: Stemming the Tide. The cumulative effect of the above challenges manifests in high turnover rates and persistent workforce shortages. Organizations struggle to fill critical positions, leading to increased pressure on existing staff, service disruptions, and a loss of institutional knowledge. This challenge is particularly acute in specialized roles or in regions with high costs of living.

Critical Information & Resource Gaps: Where Knowledge is Needed

Beyond these direct challenges, the research also identified five areas where stakeholders expressed a critical need for more information and resources. These gaps often intersect with the challenge areas, highlighting where targeted research and intervention could yield significant benefits:

Employee Morale & Engagement: While burnout is widely recognized, understanding the nuances of what drives (or diminishes) employee morale and engagement, and how to effectively measure and improve it, remains an area requiring more focused data and best practices.
Public Perception of Nonprofit Work: The societal value of nonprofit work is often underestimated or misunderstood, impacting everything from fundraising to recruitment. Better understanding and shaping public perception could enhance the sector’s ability to attract talent and secure resources.
Technology & AI: Embracing the Future. The rapid evolution of technology and artificial intelligence presents both opportunities and challenges for nonprofits. There’s a significant gap in understanding how to effectively leverage these tools, train staff, and address potential impacts on workforce structure and job roles.
Unionization in the Sector: A Shifting Landscape. While historically less common, interest in unionization is growing within the nonprofit sector. There’s a need for more information on the prevalence of unions, their impact on organizational dynamics, and best practices for both management and employees in this evolving area.
Volunteer Engagement: The Unsung Heroes. Volunteers are the backbone of many nonprofits, yet comprehensive data and effective strategies for their recruitment, management, retention, and integration into the broader workforce are often lacking. Understanding their motivations and optimizing their impact is crucial.

Initial Insights from the 2026 Survey: "Doing the Work of Nonprofits"

While the full findings from the 2026 Nonprofit Sector Workforce Survey are still under review, the Independent Sector has already published its first research brief, "Doing the Work of Nonprofits," which highlights initial key data. This brief provides a foundational understanding of the composition of the nonprofit workforce.

Among organizations with at least one paid employee, the survey found a diverse landscape: 15% reported having fewer than four employees, highlighting the prevalence of small, often grassroots organizations, while 14% had more than 50 employees, representing larger institutions. This demonstrates the wide spectrum of organizational sizes within the sector.

Crucially, the brief emphasized that "the work of nonprofits is being done by people in a variety of roles." Nearly all surveyed organizations reported having board members, most reported engaging volunteers beyond their boards, and a significant majority also utilized paid consultants or contractors. This underscores the multifaceted nature of the nonprofit workforce, extending beyond direct employees to include a vital ecosystem of dedicated individuals contributing in various capacities. The brief offers more detailed insights into which functions nonprofits rely on these different groups to perform, providing a clearer picture of the human capital architecture of the sector.

Independent Sector’s Commitment: A Call to Action

The identification of these profound challenges and critical information gaps solidifies the mandate for the Independent Sector’s new Center on the Nonprofit and Philanthropic Workforce. The organization understands that these issues are not easily solved, nor can they be tackled in isolation.

Dr. Watkins’ Perspective: Addressing Systemic Issues

Dr. Akilah Watkins articulates a clear vision for the Center, acknowledging the systemic nature of the problems. "Though funding and political disruptions exacerbated these challenges in 2025, workforce issues are chronic across the sector," she stated. "We do not expect that Independent Sector will be able to address most of these challenges right away or on our own. These issues are complicated, interconnected, and systemic; addressing them will require long-term investments and careful work across coalitions." This perspective highlights a pragmatic yet determined approach, emphasizing collaboration and sustained effort over quick fixes.

The Center’s Mandate: Research, Advocacy, and Solutions

The Center on the Nonprofit and Philanthropic Workforce will serve as the Independent Sector’s primary vehicle for addressing these complex issues. Its mandate is multi-faceted:

Continued Research: To deepen understanding of the nonprofit workforce through ongoing data collection, analysis, and publication of timely research briefs and reports.
Convening Stakeholders: To bring together diverse voices from across the sector – nonprofits, funders, policymakers, academics, and workers themselves – to foster dialogue, share best practices, and co-create solutions.
Advocacy: To champion policies that support a thriving nonprofit workforce, including advocating for fair compensation, equitable funding models, and supportive regulatory environments.
Resource Development: To develop and disseminate practical tools, guides, and training programs that help nonprofits improve their human resource practices, foster healthier workplaces, and enhance staff well-being.

By centralizing these efforts, the Center aims to provide a coherent and influential voice for the nonprofit workforce, ensuring that their needs are heard and acted upon at all levels.

Why Share the Findings? Transparency and Collective Impact

The Independent Sector’s decision to publicly share the findings of its initial research, despite it being primarily for internal decision-making, is a testament to its commitment to transparency and collective action. This approach is rooted in the belief that the challenges facing the nonprofit workforce are too vast and too critical for any single organization to solve alone. By openly disseminating data and insights, Independent Sector aims to:

Inform and Educate: Provide the sector with the evidence base needed to understand the scope and nature of the workforce crisis.
Catalyze Action: Encourage other organizations, funders, and policymakers to recognize the urgency and invest in solutions.
Foster Collaboration: Invite partners to join in developing and implementing strategies to support nonprofit workers.
Validate Experiences: Affirm the struggles of nonprofit employees and employers, showing that their concerns are being heard and systematically addressed.

This open-source approach to knowledge sharing is a cornerstone of the Center’s strategy, designed to empower the entire philanthropic ecosystem.

Charting the Course Ahead: Implications and Future Steps

The launch of the Center on the Nonprofit and Philanthropic Workforce marks a pivotal moment for the independent sector. It signifies a long-term commitment to addressing issues that are fundamental to the health and effectiveness of charitable organizations.

The Road Ahead: Long-Term Investment and Collaboration

Independent Sector recognizes that solving deeply embedded, systemic issues will require sustained effort. The challenges identified are not merely temporary disruptions but chronic conditions that demand long-term investments and strategic, collaborative work across diverse coalitions. This implies a need for funders to reconsider traditional grantmaking practices, for policymakers to develop more supportive regulatory frameworks, and for nonprofits themselves to prioritize their human capital. The Center will play a crucial role in facilitating these conversations and driving forward a collective agenda for change. The implications of inaction are severe: a weakened nonprofit sector means a weakened social safety net, with direct negative consequences for the communities these organizations serve.

Upcoming Research and Engagements

The Independent Sector research team will continue to disseminate the findings of its initial nonprofit workforce research through a variety of channels, including:

Blog Posts: Timely articles offering deeper dives into specific aspects of the research.
Research Briefs: Detailed reports providing comprehensive data analysis and recommendations.
Virtual Town Halls: Interactive online sessions to discuss select topics, allowing for direct engagement with sector leaders and practitioners.

The next focus topics in this series will specifically address volunteers in the nonprofit sector and the pervasive issue of burnout in the nonprofit workforce, building upon the initial insights from the NSWS.

Furthermore, the Center is actively pursuing follow-up projects on other critical topics, including a focused examination of mental health and wellness benefits within the sector. These projects will often involve working in collaboration with other researchers and organizations, leveraging collective expertise to generate more comprehensive and actionable insights.

A significant development for researchers and practitioners will be the public release of the data from the 2026 Nonprofit Sector Workforce Survey. This valuable dataset will be made available for public research use alongside data from the National Survey of Nonprofit Trends and Impacts in late 2026 or early 2027. This commitment to open data will enable a broader community of scholars and analysts to contribute to understanding and addressing the sector’s workforce challenges.

The Broader Impact: Sustaining the Social Safety Net

The success of the Center on the Nonprofit and Philanthropic Workforce will have far-reaching implications. A robust, well-supported, and equitably compensated nonprofit workforce is not just an internal sector concern; it is a societal imperative. These individuals deliver essential services, advocate for vulnerable populations, drive innovation, and build community resilience. By strengthening the capacity and sustainability of this workforce, the Center will ultimately contribute to a more just, equitable, and thriving society for all. Its work will underpin the very fabric of civil society, ensuring that the organizations dedicated to public good can continue to operate effectively and fulfill their vital missions.

How to Engage: Joining the Movement

The Independent Sector extends an open invitation to all interested stakeholders – nonprofit professionals, leaders, funders, policymakers, and advocates – to engage with the Center’s work. To stay informed about ongoing research, activities of the Center on the Nonprofit and Philanthropic Workforce, and other ways Independent Sector advocates for the nonprofit sector, individuals are encouraged to subscribe to their newsletter. This collective effort is crucial for transforming the challenges facing the nonprofit workforce into opportunities for growth, resilience, and lasting positive change.