STAFFING & The Vanderbloemen Search Group and Leadership Network Method for Analyzing the Cost Efficiency of Your Staff (FTE, full-time staff equivalency)

by Tim Stevens, Vanderbloemen Associates, 5/30/18.

… Below are three key factors to consider when answering the question, “Are we spending too much on staff?”

1. Percentage of Budget Designated for Staff

…Generally you will hear that your staff expenses (salaries, benefits, training, etc.) should not exceed 50% of your total general operating budget. That is a good rule-of-thumb, but there are several variables that you’ll want to consider, as each situation will be different.

  • Established multi-site churches with several sites often see staff costs as low as 35% to 40% of their overall budget. This is because they can find efficiencies with a central support staff, and if they utilize a video venue model, they don’t have to pay teaching pastors for every location.
  • If you believe in hiring proven leaders who can grow their ministry, you will likely have a higher percentage of your budget going toward staff. High capacity leaders cost more.
  • If most of your hires are internal (hired from within your congregation), you might be able to keep staff costs lower. These staff members might be in a dual-income family (thus reducing costs of benefits), and might be willing to work for far less than the national average due to their connection to the church and belief in the mission.
  • How well you leverage your volunteer base will make a difference in how much you spend for staff. I’ve worked with many churches that have a history of hiring staff way too quickly. Their first impulse is to hire, rather than to organize and equip volunteers. I think that is wasteful, both of the church’s money, but also of the giftedness of the congregation members, many whom would step up and serve if asked…

2. Staff-to-Congregation Ratio

The second benchmark is to look at how many staff you have compared to the size of your congregation (measured by average weekly attendance). Vanderbloemen Search Group and Leadership Network published a joint study of large churches (defined as 500+ in attendance) that took a deep look at salaries and trends in church staffing. That study indicates that the attendance to staff ratio is 76:1. That is, for every 76 persons in average worship attendance, churches have one full-time staff person. Those numbers consist of all staff, including pastors, directors, administrative staff, custodians and others. (It would not include staff devoted to non-church functions like a school).

Other studies have reported similar findings. Paul Alexander, who works with The Unstuck Group, reports that they see the average ratio of churches they consult at 86:1.

How to calculate your ratio:

Example Your Numbers
1. Add the total weekly hours of your part-time staff

(Example: 2 staff x 10 hours (20), 2 staff x 20 hours (40), and 1 at 30 hours would equal 90 hours)

90
2. Divide line #1 by 40 2.25
3. Add total number of full-time staff 6
4. Total Full-Time Equivalents (add lines 2 and 3) 8.25
5. Average weekly attendance (include kids) 950
6. Divide line 5 by line 4 115
7. The result is your attender-to-staff ratio 115:1

If your ratio is higher than 90:1, that means you are more efficient with your staff than the typical church. This might be a good sign, demonstrating a highly efficient team or showing an unusually good usage of volunteers. It also might mean your team is showing stress cracks. If you are in this category, and you have noticed your team is working unusually long hours and finding it difficult to balance family with work, then you probably need to work toward a solution that may involve bringing on additional staff. If you have high turnover, it might mean the expected work level is unsustainable.

If your ratio is lower than 70:1, then you are blessed with more staff than the average church. Start-up churches often have low ratios since they begin with a core of staff (worship, teaching, children, etc.) and initially don’t have any people. Their staff ratio can get closer to the average as the church takes root…

3. Combining These Two Benchmarks

For a deep dive into your numbers, consider both of these benchmarks together. What percentage of budget are you spending on staff and what is your attender-to-staff ratio?

  • If your ratio is low (staff-heavy) AND your percentage is low – you have room to increase salaries. Make sure you are paying your core staff what they are worth. It costs a lot more money to replace a high-performing staff member than it does to keep one. Consider this as you set next years’ salaries.
  • If your ratio is low (staff-heavy) AND your percentage is high – you need to consider reducing staff over time through attrition. You likely have too much staff. If your offerings are okay, you probably don’t need to lay off staff. But every time someone decides to leave, you should consider moving people around and avoid replacing them – that is, until your attendance or offerings increase.
  • If your ratio is high (lean staff) AND your percentage is low – you have room to hire additional staff, and may want to consider doing this for the health of your existing staff. They are likely feeling the stress of long hours and wearing multiple hats. Get them some help!
  • If your ratio is high (lean staff) AND your percentage is high – you likely have limited income and need to work hard to engage and equip your volunteers to help carry the load. Consider getting a copy of my book, Simply Strategic Volunteers, and focus on getting more of your laity engaged in the work of the ministry.

This article provides some broad categories that will hopefully give you some direction. If our team at Vanderbloemen Search Group can be helpful in providing customized consulting for your team, we’d love the opportunity to partner with you.

Read more at … https://www.vanderbloemen.com/blog/cost-efficient-employees-church

STAFFING & A History of FTE (full-time staff equivalents) and How Many Staff Members Do You Need? #Staffing/MembershipRatios

By Susan Beaumont, Ministry Matters Magazine, 6/29/13.

… Faith Communities Today (Fact 2008, 2010) is a study out of the Hartford Institute for Religion Research, that looked at, among other things, how 3,000 congregations allocated their budgets. Researchers discovered that the average U.S. Protestant congregation allocates 45 percent of its total operating budget to payroll-related costs. Mainline churches spend considerably more (49 percent) on payroll-related expenses than either the Evangelical Protestant (31 percent) or the Catholic/Orthodox communities (41 percent)

… A Leadership Network study (which focused on staffing costs in larger congregations) found that the following factors were related to staff costs:

  • Whether the church is growing. Staffing costs are leaner for churches whose attendance is growing, perhaps because growing churches have not “caught up” with emergent staffing needs.
  • The dominant age group of the congregation. Staffing costs are leaner, but only slightly, for churches where the average person’s age in the congregation is lower.
  • The year in which the church was founded. The younger the church, the leaner the staffing costs.
  • The location of the church. Staffing costs are lower for residential and new suburban locations and slightly higher for older suburb and downtown churches.
  • Race. Staffing costs are leanest for predominantly African American churches and highest for Anglo European churches.
  • Use of paid part-time staff. Staffing costs have no relationship to the percentage of paid part-time staff in relation to full-time staff, until a congregation employs three or more paid part-timers for each full-time staff.
  • Economic level of the congregation. Staffing costs are leanest for churches whose internal constituency is described as poor and highest for churches with an internal constituency described as wealthy.

Staffing/Membership Ratios

Perhaps the longest standing rule of thumb about staffing structures is the ratio of program staff to average worship attendance. In 1965 Martin Anderson wrote one of the first books to address staffing models in the larger church, Multiple Ministries. He recommended a staffing ratio of 1 pastor for every 500 members (1:500) . Looking back on that number, it is hard to believe that congregations ever functioned with such lean staff teams, but in fact they did. Remember that this book was written during a time when worship attendance and membership were more closely aligned, when membership meant different things than it does today, when volunteerism in the church worked differently, and when church programming was more homogenous and standardized than it is today. No church today would ever dream of targeting a 1:500 staffing ratio and expect to meet the needs of its congregants.

In 1980 Lyle Schaller wrote The Multiple Staff and the Larger Church in which he introduced average worship attendance as a more reliable indicator of staffing needs. Schaller proposed a ratio of 1:100 as a guideline for the typical ratio of full-time paid professional staff positions in mainline Protestant congregations. In 2000 Gary McIntosh wrote Staff Your Church for Growth and suggested that a 1:150 paid professional staff ratio was a more realistic and affordable guideline. Both Schaller and McIntosh focused on the combination of professional clergy leaders and professional program staff leaders. Their ratios did not include administrative or support staff. Both assumed that the staffing ratio remained constant across size ranges.

So, given these conflicting guidelines, what is the most effective way to think about the size of the staff team relative to the active membership base of the congregation? The same 2010 Leadership Network Study that looked at the characteristics of a lean staff team created an alternative way of thinking about staff size relative to attendance. Rather than thinking solely about program or clergy staff in relationship to attendance, the Leadership Network study looked at the ratio of all full-time staff equivalents (FTEs) to attendance. Furthermore the study looked at how that ratio changed as the percent of budget devoted to staffing expense increased and decreased. Here is what they found.

Staff Costs as a Percent of Budget              Ratio of Staff to Attendees

10-19%                                                1:108

20-29%                                                1:91

30-39%                                                1:73

40-49%                                                1:73

50-59%                                                1:70

60-69%                                                1:59

The conclusion here is obvious. If you spend more of your budget on staff, then you have more staff per attendee than other congregations do. The results also suggest that churches with higher staffing budgets don’t necessarily pay their staff better; they just hire more staff. The ratios are helpful benchmarks as to how many staff congregations employ. Given that the average congregation spends between 48 and 50 percent of its operating budget on payroll, we can assume the average congregation employs one full-time equivalent staff member for every 70 to 73 people in average weekend worship attendance.

Determining how large of a staff team that you need depends upon your mission and your context. No benchmark can answer the question for you. It should never be your objective to match the averages quoted in this article. However, these averages can be used as a starting point for good dialogue between you and your leaders. Do you lie inside or outside of the normative parameters outlined here? In what ways does the unique nature of your mission and your context require something outside of the norm?

Read more at … https://www.ministrymatters.com/all/entry/4094/how-many-staff-do-you-need

#OD723 #FTE

PASTORAL TENURE & Infographic: Every Pastor Is an Interim Pastor (Even if You’re There 30 Years)

by Leadership Network, 6/14.

Newspapers rarely run articles titled, “Pastoral succession was so seamless and smooth that church momentum didn’t skip a beat.” They should. Those successions do happen. It’s largely the bad news that makes headlines. The reality is no matter how long you’re at your church, at some point you need to prepare to pass the baton – and there’s help for doing it well.

If your church is anticipating succession in the next few years, let us help you walk through the stages of preparation and transition — on May 3-4, 2016, in Houston. CLICK HERE to tell us about your situation, and then we’ll contact you.

This infographic tells you a little of what we’ve learned so far:

Read more at … http://leadnet.org/wp-content/uploads/2015/06/Succession-Facts-FINAL.png

MEGACHURCH & How U.S.-style megachurches are taking over the world, in 5 maps

Commentary by Dr. Whitesel: This research by the Hartford Institute for Religion Research and Leadership Network points out that megachurches are internationally comprised of lower socio-economic congregants, while in No. America they are reaching mostly an upper socio-economic strata. This has implications for the goals and economies of megacongregations. For instance, is there greater responsibility put upon these churches and for what missional end? Read this article before you craft your answer.

By Rick Noack and Lazaro Gamio, The Washington Post, 7/24/15.

world-megachurches3.jpg&w=480

… while the United States may have started the trend, the future of megachurches may lie in the rest of the world.

Based on data from the Hartford Institute for Religion Research and from the Christian nonprofit organization Leadership Network, WorldViews visualized this global and diverse movement. We used the most common definition of megachurches, which describes them as having “2,000 or more persons in attendance at weekly worship, a charismatic, authoritative senior minister, a 7 day a week community,” and other features which you can find in detail here.

Why global megachurches are bigger than U.S. megachurches

Despite American roots that reach back to the 19th century, megachurches abroad now have a higher average attendance, even though the vast majority of megachurches are still in the United States. While there are 230 to 500 such churches elsewhere in the world, the Hartford Institute estimates that there are about three times more megachurches in the United States.

In the United States, the median weekly attendance is about 2,750, while the median weekly in world megachurches is nearly 6,000. One factor that could explain the larger sizes on other continents is a lack of alternatives for believers.

“Outside the United States, it takes a large amount of charisma and capital to create a megachurch,” said Scott Thumma, director of the Hartford Institute. In the United States, however, competition among megachurches is fierce because it is easier to establish such communities. “It is harder to be massive here in U.S.,” Thumma added, citing zoning laws, safety inspections, construction and property costs.

Nevertheless, he believes that smaller megachurches do not lag behind in an international comparison. “I was just at four megachurches within a few miles of each other in Atlanta, and each of these cater to a slightly different audience,” Thumma said.

The differences between U.S. and global megachurches can even be noticed on satellite images. Abroad, megachurches are often constructed in the centers of cities, where they are accessed by foot, subway, bus or cab. In the United States, community members usually access the churches by car. To provide the necessary parking lots, U.S. megachurches are often in suburban areas.

compare-megachurches2.jpg&w=480

Read more at … https://www.washingtonpost.com/news/worldviews/wp/2015/07/24/how-u-s-style-megachurches-are-taking-over-the-world-in-5-maps-and-charts/

MEGACHURCH & Demographics of the Typical Mega-congregation

by Morgan Lee, How 727 Megachurches Spend Their Money, Christianity Today, 11/12/14.

According to the 2014 edition of the Large Church Salary Report

  • the typical large American church (1,000 to 7,000 members)
  • was founded in 1977,
  • seats 800 worshipers,
  • and offers five weekly services at two campuses.
  • The church’s 52-year-old senior pastor was hired in 2005,
  • it employs 25 staff members,
  • and attendance has been recently growing 7 percent per year.

And check out the Leadership Network’s research on megachurches here …
http://leadnet.org/leadership-networkvanderbloemen-2014-large-church-salary-report/

FINANCES & State of the Plate Research

Commentary by Dr. Whitesel:  Here is an article to assist in making sound financial judgments (and to underscore the relevance of this finances for leaders).  It is called the “State of the Plate” report and it is the research of Christianity Today and Leadership.  It was shared with me my one of our adjunct instructors, Professor Halee Scott.  Here it what she found:

http://www.christianpost.com/article/20100324/survey-financial-strain-worsens-for-more-churches/index.html

MULTISITE & Campus Pastor as Key to Multisite Success #LeadershipNetwork #WarrenBird

Commentary by Dr. Whitesel: A multi-campus or multi-site approach creates an “economy of scale” that can better fund and support church multiplication. I call this the “Alliance Model of Church Multiplication,” which especially lends itself to growing multi-ethnic and multi-cultural churches. However more important than the lead pastor in this strategy, is the campus pastor who will indigenize the church’s ministry to the local context. See this helpful report with sample job descriptions by my friend Warren Bird. It examines what makes a good campus pastor and why selecting them is even more important than selecting locations for church multiplication strategies.

campus-pastors_20150928184243_1443465763993_block_9

by Warren Bird, Leadership Network, 10/8/15.

One of the most-asked questions from multisite churches is, “What should we look for in a campus pastor?” or more specifically “What are some of the best campus pastor job descriptions that we could adapt?”

This mini-report, drawing from a recent Leadership Network survey of campus pastors, tries to address just that. It shows the relationship between what a campus pastor does, and how those emphases impact the job description. The final part of the report reprints a number of actual job descriptions for a campus pastor (and offers a way to obtain even more examples)…

Download the report here … http://leadnet.org/campus-pastor-as-key-to-multisite-success/