Greater Cleveland Food Bank leads the way by raising wages
Posted January 22, 2019 in Press Releases
Across Ohio, a large network of nonprofit organizations works to fight hunger, provide child care, treat illness and deliver vital services that Ohioans need. Their work stabilizes families and reduces the worst effects of poverty. Yet many of those same organizations rely on a low-paid staff themselves struggling with financial hardship.
To make its staffing practices consistent with its mission of reducing poverty, the Greater Cleveland Food Bank implemented a $14 base wage for its workforce in Fiscal Year 2017.
Nonprofits face unique challenges to paying living wages. They often serve a population in or near poverty, and their revenues are frequently from third parties.
A new case study from Policy Matters Ohio documents the Food Bank’s new wage structure and how it affected costs and outcomes. Its experience is an example for other nonprofits.
When the food bank raised its base wage 21.7 percent, its operating costs increased by just 0.5% - it raised new revenue and streamlined administration to meet the new costs. Food ank leadership found the investment not only aligned with its mission, but paid off too: its employees became more reliable, it was able to recruit more qualified workers for new positions, and the organization saved money from reduced turnover.
One of the food bank’s proudest outcomes was when a valued former employee returned to the organization after the new wage was announced. The employee had left for a $.50 per hour raise.
“We were thrilled that this change could make such a difference in the lives of our employees,” said Lisa DiCapua, Director of Human Resources for the food bank.
Ohio’s minimum wage today is worth 27.7 percent less than it was at its peak in 1968. At that time the nominal value of the wage was $1.60, which adjusted to inflation would be worth $11.83 today.
“Ohio needs a living minimum wage, but we also need adequate funding for nonprofits that provide Ohio families with vital services,” said Michael Shields, report author and researcher at Policy Matters. “Nonprofits that work to alleviate poverty can be part of the solution by making sure their own staff earn enough to get by.”