According to a recent study released by the Personio Foundation in collaboration with consulting firm Impact46, nongovernmental organisations, or NGOs, are struggling to recruit and retain talent. Such labour shortages can hurt NGOs' abilities to fulfil their vital social mission objectives.

More than half of NGOs surveyed, 52%, indicated that attracting skilled staff is a major problem. As these organisations compete fiercely for donated funds, 72% report that their salaries are not competitive compared to the private sector.

Non-monetary factors such as a shortage of promotion and development opportunities, lack of recognition and challenging working conditions — often due to operating in crisis regions or psychologically stressful situations — resulted in a staff turnover more than 10% higher than in the private sector.

According to the study, overcoming these challenges requires NGOs to take a fresh approach to allocating funds.

"In addition to traditional project funding, the focus should be on strategic investments — such as personnel management and organisational processes," Phillipp Richter, managing director of the Personio Foundation, said in a press release. "This is the only way for NGOs to create sustainable organisations that provide the best possible support for their mission and the employees implementing it."

Among NGOs surveyed, half have fewer than ten employees. Additionally, more than half, 56%, do not employ a full-time professional responsible for people management.

Richter noted that NGOs have been slow to adopt digital HR tools that could benefit them. Almost 40% cite the lack of HR management tools as one of their biggest challenges. The absence of data for performance reviews or project tracking hinders the introduction of standardised evaluation criteria for employee performance. It makes it difficult to demonstrate success and the establishment of professional, data-driven structures, according to the study.

The study surveyed over 1,100 NGOs from 115 countries worldwide.

- Henry Liu