NGOs part 1 – Pay your workers less

I don’t usually preface, but in this case it may help people dislike me less :p. I believe that NGOs go about much of their work the wrong way in Northern Uganda, to the point where some of them may do more harm than good. I’m writing a series of blogs on where I think NGOs are going wrong, and how they could fix it. These here are opinions. Informed opinions after 4 years operating amongst NGOs in Northern Uganda, but opinions only.

Abandon Ship

Last year, one of our best nurses left one of our rural health centers. With no warning and without telling anyone. It was the 3rd nurse that year who left for an NGO job. We rushed to replace him, but it put the only remaining nurse there under a lot of stress, and I’m sure patients weren’t cared for as well in the meantime. Our replacement wasn’t as good. I didn’t hear the nurse who left again until 6 months later, last week. He came to apologise for leaving abruptly. He said he felt really bad about it, that he had let his fellow staff and the patients down. He’s a great guy and it was good to catch up and reconcile everything. When I asked him why he left for the NGO job, he looked at me as if it was a stupid question.

“The money was too much, of course”

Too Much Money?

So why is it bad to pay Ugandans a lot of money in NGO jobs? Surely you pay them as much as you can afford to help them and their families get by in a poor country. Unfortunately, its not that simple. There are at least 3 enormous negative effects of high NGO salaries.

1) High quality workers get lured out of sustainable, productive service provision jobs (health work, business, teaching etc.) and into the NGO sector. It’s a local brain drain of epic proportions. In one case this became so extreme that the run-down government hospital wrote to anNGO asking them to stop stealing their nurses! Most of the best minds should be innovating and leading the society from institutions and businesses that will continue serving people indefinitely. Instead the NGO sector is overloaded with the best educated and most capable, while the cogs which drive sustainable progress creak and come to a halt.

2) The distraction of huge NGO salaries means that workers don’t concentrate and get stuck into their current jobs. Many workers have a legitimate ‘grass is greener’ syndrome. People are ever on the look out for that ‘Golden Goose’ job which pays 2 or 3 times as much, even if the NGO job only lasts 6 months. You wouldn’t believe how much time and effort local people spend thinking about and applying for NGO jobs rather than getting on with their current work.

3) High NGO salaries wreck the aspirations of young people and skew the entire education system. When you have a deep, honest conversation with people at university about what they want to do, very few have serious aspirations to help their country, or bring people out of poverty. What they really want is a cushy, high paying NGO job. People should have a heart to start productive businesses, teach at schools, be nurses at hospitals. To work within the system to create lasting change. When we advertised for a job managing our Anglican church health centers, I was expecting degrees in public health, or at least administration. But no, over half of the 80 applicants had a degree in “development studies”. What even is that degree? A ticket in the lottery for a bloated NGO job. Another phenomenon is that many people want to be ‘drivers’ so they  earn more than teachers or nurses by driving NGO workers around. Bizarre.

So why do NGOs pay too much? From talking to a bunch of people about it, these are some of the reasons (again add your own!)

1) The donors back home just don’t understand local salaries
2) NGOs have a budget which they need to spend, and salaries is a way of spending it.
3) NGOs rely on local NGO workers to suggest/decide on salaries – perpetuating the cycle
4) Wanting the best worker possible for their job (not OK, see below)
5) Wanting pay equity between local and Ex-pats (White guilt plus healthy instinct)

The Solution

The good news is that we can solve this problem almost overnight! Here’s how.

  • Pay the market rate for your staff. Find out what the local market rate is for teachers, nurses, lawyers or whoever else you hire. Ask for the salaries for similar positions among business people, government and private not for profit enterprises (Church Run) and add no more than 10% to that.
  • Not pay Ex-pats much more than you pay locals. Wanting equity between local and expat workers is fantastic, but the solution is not to increase the local salary, but lower the Ex-pat’s! This reduces the tension to have to pay locals ludicrous salaries to match. If Expat NGO workers can’t handle being here on close to local salaries, then I don’t believe they should be here. It should be a sacrifice to work a place like Norther Uganda, a big one. Awesome hard working, caring Ex-pats will still come work for your NGO, even if they are paid less.
  • Be prepared to not hire the ‘best of the best’ with a reduced salary. Why should NGOs get to hire better workers than the government, buisnesses, or mission hospitals? Realise that your work is not usually more important than what everyone else is doing. Be comfortable with hiring good workers, even if they aren’t the best. You’ll still get good workers, don’t worry!

Then spend the money you save on salaries on…. whatever you think is best! Hire an extra worker, sponsor more kids to school, drill more boreholes. It’s a win-win for everyone.

Feel free to disagree, comment, agree, ask questions, disagree or whatever you please.

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11 Responses to NGOs part 1 – Pay your workers less

  1. If more people spoke out as frankly and honestly as you, many of the world’s problems would be cut down to size!

  2. Les Brighton says:

    Terrific. I hope this gets to the ears of those who need to hear it, Nick. Good to get it out there for general consumption, but what would be the ways of influencing/challenging individual policy-setters in individual organisations?

    • ntlaing says:

      Thanks Les, that’s a good question! You’d have to talk to the people right at the top I’d imagine The problem is that NGOs operate very independently and are based all around the world. There’s no real forum or conference where they discuss this kind of stuff – not that I know of anyway. Perhaps starting with bigger NGOs like World Vision, Tearfund, Oxfam would be an option.

  3. Ray says:

    Well argued and logical Nick. As you indicate, getting NGOs to consider these concepts would be difficult, because the decision makers are not at the front or in the country concerned.One would think that with so much reliance on donated funding they would be trying to keep the costs down, not flooding the market.

    • ntlaing says:

      That’s a good point on saving money! I really feel that lowering the salaries would be a win-win for everyone. I also think New Zealanders might be horrified to find out how much of the money they give to NGOs goes to in-country admin. Of course we need that admin but it does get ridiculous sometimes.

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  8. JJ says:

    Respectfully, I find this to be a series of very ridiculous arguments and would love to have a pleasant and productive debate about it. If this does not get posted publicly, feel very free to email me and we can have the discussion there. From your arguments, It seems like there’s potentially a misunderstanding about capitalism and the labor market. Here are my thoughts:

    First, NGOs ARE part of the marketplace. Why wouldn’t they be? Furthermore, NGOs operate just like a business only that their stated end goal is not profit for owners/shareholders. However, this does not mean they won’t be cut-throat competitive for funding and notoriety and talent — sadly it’s naive to think otherwise. Just because they have a bright amazing social impact goal, does not mean they are necessarily going to contribute to anyone else’s idea of social impact.

    1) Many NGOs (not all, but very likely the ones you are talking about who pay “inflated” salaries) bring in experts and highly trained individuals from other countries, backgrounds, circumstances and experiences. Doesn’t working with those people almost assuredly enhance the capacity of an local individual, even if only because they get exposed to a different approach/viewpoint? Will the institutions and businesses you’re talking about actually continue serving people indefinitely? Why necessarily longer than the NGO will? From your other post, it sounds like running a clinic is not all that easy to do sustainably — that cannot all be because from cost of talent.

    2) So this is a reason to not pay some qualifying individuals more money? That is so silly. This is how a market works. The highest paying jobs will attract the greatest number of applicants and the best qualified applicants. I would argue that these high paying jobs actually provide a decent level of motivation for people to improve and be ambitious about what they reach for — especially in a society/economy where many jobs don’t allow for much social mobility and the life challenges are so constant.

    Yes, people of all income levels (mostly poor) play the lottery all the time. Every study shows it is completely absurdly and ridiculously financially irrational. That does not mean it is anyone’s right to tell those people they should not play. From a work productivity standpoint, I think it is their manager who should do a better job of helping them stay on track and pushing them to improve so they can reach that high paying job, if that is their professional goal.

    3) Why would you expect these people or anyone to have “serious aspirations to help their country, or bring people out of poverty?” What percentage of people at university in your home country go into a job devoted to bringing people out of poverty or helping their country? In mine, I bet that number is < 15%. In a place like Uganda with so much uncertainty and challenge, I would not be surprised if that number is lower as people try to take care of themselves and their families. Why should people have a heart to start productive businesses, teach at schools, or be nurses at hospitals? What if they don't want to do those things? What if they rather feed their family, have a healthy pot of savings for emergencies, and send their kids to the best school they can find? What if they rather start a non-profit caterpillar sanctuary for fun? Does that make them lesser people?

    Who is to say these people are all going to end up spending all the money from that high paying NGO job on themselves? In my experience in Uganda, after feeding themselves well and taking care of basic personal/family things, most people prefer to invest that money in a farm, small business, or a family member attending school. Those do not sound so bad. Additionally oftentimes you need money to "help [your] country, or bring people out of poverty." Sometimes the university graduate who works at an soul-less investment bank for 5 years and saves up $1m which he uses to start a financially sustainable project helping hundreds of thousands of people in Northern Uganda has greater impact than the university graduate who goes directly Northern Uganda and lives on a local salary helping only the people in close proximity to the clinic where he works (<50,000 over those 5 years?). Should we tell the investment banker not to do it? Isn't he likely to be helping a greater number of people than the other student?

    Regarding your causes:
    1) Potentially, but so what?
    2) Potentially, but not convincing. Most would probably do everything possible to improve performance indicators they can report on publicly and to the donor.
    3) Potentially, but you have to start somewhere and it's a negotiation. Doesn't the same thing happen in your home country? Aren't people allowed to negotiate and propose to an employer what they feel they are worth?
    4) 100% ok and definitely very legitimate reason for paying more money. Shouldn't the best worker be rewarded for their hard work? This is potentially why the $60/mo cleaning man/lady is repeatedly absent from work without cause.
    5) Potentially, but not convincing. Expats often (not always) have greater amount of training and expertise so there should be no real comparison of salaries. Most just want to provide fair pay for work and they want their staff to be comfortable, safe, and happy working there.

    Regarding your solutions:

    1. Why? You don't want those people to have more than 10% of the market rate? What if they are really really good? We can't reward and motivate the people who are super good at what they do? I guess those people might as well put in less effort and just do a mediocre job that will earn them 0-10% above market. Also, who do we ask for the salaries? We can't ask local people because that will perpetuate the situation. We can't ask NGOs because those salaries are also inflated..

    2. This is absurd. Let me get this straight. To extrapolate your argument, you think that if, for example, we brought the 50 top health experts in the entire world – both policy and practitioners – to focus solely on the Ugandan healthcare system for a number of years that they shouldn't be here if they don't want to eat posho and beans everyday and use a pit latrine?

    Furthermore, you're basically saying that only expats who are wealthy in the standards of their home country can come work here in Uganda? I'm from the US where 70% of new graduates have student debt and the average balance for those individuals is over $30,000 (yes, not all countries have it that bad but just an example) if I'm not mistaken. Do you think it's feasible for those people to pay that debt back in their lifetime on a local salary? What if the expat doesn't have student debt but they want to go home to see their family once in a while or god forbid there is a emergency/death in their family and they want to go back for a funeral? What if they have children they are supporting through university in their home country? What if they have medical conditions or expenses they can't afford to get on a local salary? Should all of these things exclude good intentioned and potentially extremely beneficial people to the country from coming here to work?

    Why should it be a sacrifice to work in Northern Uganda? This one I really do not understand so I cannot provide a response. I lived up near Pader and thought it was a total joy! No sacrifice of significance whatsoever. Honestly.

    Don't you think these NGOs want to save as much money for their mission and beneficiaries as you do? Why do you assume they are any different than you? As I said, they are a business. Anything they don't pay in salaries is money that can go towards helping them reach 10,001 families instead of 10,000 or it can go towards helping them advertise and fundraise so they can start new programs and reach more families. To reiterate, they are a business. If they could get people with the proper experience to come work for free TRUST ME, THEY WOULD. That is one thing in here I am definitely 100% sure of.

    NGOs don't get to hire the best of the best because they think their work is more important than anyone else's. They get to do it because they have more money. Plenty of private companies are exactly the same. Salary levels are not always based on importance of the work.

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