more similarities or more differences comparing public and

Focus on Seminal Nonprofi t Management Issues

Young-joo Lee is an assistant professor of

public affairs at the University of Texas at

Dallas. Her teaching and research interests

include human resource management

in public and nonprofi t organizations, volun-

teering, and intersectoral collaboration.

E-mail: [email protected]

Vicky M. Wilkins is an associate professor

and the director of the MPA program in

the Department of Public Administration

and Policy at the University of Georgia.

Her teaching and research interests

include public administration, public

personnel management, and representative

bureaucracy. Her research has appeared

in the American Political Science Review,

Public Administration Review, Journal of

Public Administration Research and Theory,

Administration & Society, Governance,

Review of Public Personnel Administration,

and Legislative Studies Quarterly.

E-mail: [email protected]

Comparing Public and Nonprofi t Managers’ Job Motivations 45

Young-joo LeeUniversity of Texas at Dallas

Vicky M. WilkinsUniversity of Georgia

Existing research on career motivations tends to focus either on the diff erence between private and public organizations or on the diff erence between nonprofi t and for-profi t fi rms. Although commonalities exist, the literature suggests that there also are many diff erences in what motivates public and nonprofi t employees. Employing data from the National Administrative Studies Project III, this research examines how seven motivational aspects correlate with the choice between public and nonprofi t employment. Th e authors fi nd that managers who value advancement opportunities, a pension and retirement plan, and the ability to serve the public in their jobs are more likely to accept a job in the public sector, whereas managers who value family-friendly policies and increased responsibility are more likely to accept a position in the nonprofi t sector. Participation in volunteering is positively associated with nonprofi t employment. Th e authors suggest a possible link between volunteering and the unique nonprofi t motivation that is diff erentiated from public service motivation.

Scholars argue that the employment sectors (nonprofi t, for-profi t, and public) diff er in

numerous ways, including environmental factors, organiza-tion–environment transactions, internal structure and processes, employee characteristics, incen-tive structures, and reporting structures (Blank 1985; Brown et al. 2000; Goodin 2003; Kearns 1994; Rainey, Backoff , and Levine 1976). Research on the diff erences between sectors tends to emphasize diff erences in the use of extrinsic and intrinsic rewards to attract employees. Specifi cally, the research argues that extrinsic motivation factors such as pay and advancement have a signifi cantly greater

motivating potential for private managers than for public and nonprofi t managers, while intrinsic rewards have higher motivating potential for public and non-profi t managers than for private ones (Khojasteh 1993; Rawls and Nelson 1975; Rawls, Ullrich, and Nelson 1975; Wright 2001). In sum, the literature suggests that public and nonprofi t employees are less likely to be motivated by extrinsic factors and more likely to be motivated by intrinsic rewards compared to workers in the for-profi t sector (Buelens and Van den Broeck 2007; Benz 2005; Handy and Katz 1998; Lewis and Frank 2002; Mirvis and Hackett 1983; Rainey 1983).

Th e existing research on career motivations tends to focus either on the diff erence between private and public organizations or on the diff erences between nonprofi t and for-profi t fi rms. Although some scholars have studied the characteristics of nonprofi t organizations that diff erentiate them from those in the public sector (Brown et al. 2000; Goodin 2003; Kearns 1994; Mirvis 1992; Schepers et al. 2005), relatively little is known about public/non-profi t diff erences in career motivations. Th is study

aims to contribute to a better understanding of the non-profi t sector by examining the distinctive career motivations of its employees. Particularly, we investigate what motivates public and nonprofi t managers to accept a job in their current organization. Th e underlying assumption in this research is that people choose to work in a sector that they expect will provide them with benefi ts they consider important, regardless of whether they are extrinsic or intrinsic rewards. By comparing job motivations of nonprofi t managers and public managers in state governments, we can improve our understanding of

More Similarities or More Diff erences? Comparing Public and Nonprofi t Managers’ Job Motivations

By comparing job motivations of nonprofit managers and public managers in state

governments, we can improve our understanding of the

motivational correlates of sector choice. This is a particularly

timely question, as many levels of government are facing

a “human capital” crisis, the boundaries between the

nonprofit and public sectors are blurring, and there is increasing

evidence that employees are willing to shift between sectors.

46 Public Administration Review • January | February 2011

fi t with their values than the other. If public agencies and nonprofi t organizations diff er in work environment and provide diff erent packages of needs satisfaction and values, individuals will try to make a choice between the two sectors based on their needs and values.

Although the research comparing the motivations of public and nonprofi t sectors is limited, a large body of research examines how public and for-profi t workers diff er in terms of the factors that motivate their sector choice. Previous research has produced mixed results with respect to how extrinsic factors motivate public and for-profi t employees. Numerous studies have found that public employees place less value than for-profi t employees on money as an ultimate goal (Houston 2000; Jurkiewicz, Massey, and Brown 1998; Karl and Sutton 1998; Khojasteh 1993; Kilpatrick, Cummings, and Jennings 1964; Porter and Lawler 1968; Rawls, Ullrich, and Nelson 1975; Rainey 1983; Wittmer 1991). However, other studies have found no signifi cant diff erences in the value that public and for-profi t employees attach to pay (Crewson 1997; Gabris and Simo 1995). In addition to pay, researchers have analyzed the importance of job security and benefi ts in motivating individuals to work in the public sector. Here the evidence suggests that public employees are motivated by these two extrinsic factors (Houston 2000; Jurkiewicz, Massey, and Brown 1998; Kilpatrick, Cummings, and Jennings 1964). In terms of job security, other research suggests that there is no diff erence (Gabris and Simo 1995; Rainey 1983), or that for-profi t employees actually value job security more than public sector employees (Crewson 1997; Wittmer 1991).

In terms of intrinsic rewards, some research indicates that public sector employees, especially managers, place a higher importance on intrinsic incentives than their for-profi t counterparts. Several studies have concluded that public sector employees are more likely to cite factors such as challenging and interesting work and recognition in their decision to work for government (Frank and Lewis 2004; Jurkiewicz, Massey, and Brown 1998; Karl and Sutton 1998; Kho-jasteh 1993). One aspect of motivation that has been widely studied in the fi eld of public administration is the intrinsic reward of serving the public.

Th e link between the desire to serve the public and job choice has been rigorously investigated in the public service motiva-tion (PSM) literature. Th is literature is built around an emphasis on the intrinsic motiva-tions in individual’s job choice. Defi ned as “an individual’s predisposition to respond to motives grounded primarily or uniquely in public institutions and organizations” (Perry

and Wise 1990), the literature argues that individuals who pursue public service careers are more likely to derive satisfaction from pub-lic sector work and less likely to be motivated by extrinsic benefi ts such as salary (Buelens and Van den Broeck 2007; Lewis and Frank 2002; Pandey and Stazyk 2008; Perry 1996). Testing the relation-ship between intrinsic motivations and career choice is important because the literature suggests that PSM is positively related to employee satisfaction, retention, support for government policy, and organizational performance (Alonso and Lewis 2001; Houston 2009; Naff and Crum 1999; Wright 2001).

the motivational correlates of sector choice. Th is is a particularly timely question, as many levels of government are facing a “human capital” crisis, the boundaries between the nonprofi t and public sec-tors are blurring, and there is increasing evidence that employees are willing to shift between sectors (Arthur and Rousseau 1996).

To address these questions, we draw on several distinct streams of literature to hypothesize how extrinsic and intrinsic motivational factors infl uence sector choice. In our empirical analysis, we analyze the survey responses of nonprofi t managers and public managers in state governments to identify and evaluate the importance of the extrinsic and intrinsic factors that motivated managers in both sectors to accept their current position; we then use that information to predict whether the manager works in the public or nonprofi t sector. In addition, we examine the association between volunteer-ing and the choice between the two sectors. In the end, our fi ndings suggest that nonprofi t and public sector managers may be attracted to their work by diff erent factors.

Extrinsic and Intrinsic MotivationWork motivation is one of the central topics in organizational stud-ies, and researchers have struggled with how to measure various dimensions of motivation. Early theories on individuals’ motiva-tion recognized the multidimensionality of work motivation. Work motivation helps explain the work-related behaviors of getting a job, keeping a job, and performing well at one’s job (Pinder 1998). Th e public administration literature makes a distinction between employee motives and work motivation. Employee motives are defi ned as the rewards or factors that attract employees to their jobs, whereas work motivation is defi ned as the drive that employees have to perform their jobs well within the context of their organizations (Wright 2007). It is theorized that because individuals perceive diff erences in the type and amount of rewards off ered by each employment sector, individuals self-select into the sector that provides the rewards and incentive structure that they prefer (Rainey 1982). Th is study focuses on one dimension of work motivation: the factors that motivate job choice.

When selecting a job, individuals seek a career opportunity that best satisfi es their needs and is most compatible with their values. Factors that motivate job choice include both extrinsic and intrinsic rewards (Lawler 1971). Herzberg’s research motivation identifi es two broad types of factors that play a role in the attractiveness of a position to an employee: motivators and hygiene (Herzberg, Mausner, and Snyderman 1959; Herzberg et al. 1957). Motivators are intrinsic to the job and include elements that relate to job content and task, such as recognition, responsibility, advancement, and personal growth and development. Intrinsic motivation is defi ned as working for the sake of the work rather than for some detachable outcomes (Ryan and Deci 2000). Th e second type is hygiene factors, which come from external sources and involve such job characteristics as pay and job security. Extrinsic and intrinsic factors can pull, or attract, an individual to a particular position because a person seeks the best fi t between the organization and himself or herself (Bright 2008).1 In this sense, individuals are expected to take a job in a sector that provides more fulfi llment of their needs and is a better

When selecting a job, individuals seek a career

opportunity that best satisfies their needs and is most

compatible with their values.


that nonprofi ts usually are founded by individuals or small groups interested in carrying out a particular mission; they strive to be responsive to the needs of individual clients, even at the expense of equity (Lipsky and Smith 1989; Lohmann 1989). Th e nonprofi t plays a role as a voice from the margins by pointing out the limita-tions of government services and off ering alternatives to them (Young 2000).

Although both sectors exist to “serve the public,” we contend that the identifi cation of clients and the setting of policy priorities make nonprofi ts distinct and infl uence the intrinsic rewards that employ-ees receive. In other words, these diff erences may result in distinc-tiveness in job content and task, and ultimately in the feelings of recognition, responsibility, and personal growth and development that an individual derives from his or her occupation. We agree with Goodin (2003) that the nonprofi t sector is “motivationally and organizationally distinct” from the state. Given this distinctiveness, the nonprofi t sector may attract a diff erent kind of worker than the public sector (Frank 1996; Handy and Katz 1998; Hansmann 1980; Mirvis and Hackett 1983).

Th e diff erences between nonprofi t and public organizations shape the extrinsic and intrinsic rewards they can off er. Th is leads us to posit that several extrinsic and intrinsic factors are correlated with an individual’s choice between working for the government or for a nonprofi t organization. We hypothesize that extrinsic factors (career advancement,2 salary, pension plans, and family-friendly policies) and intrinsic factors (job responsibility and the desire to serve the public) are related to the sector in which an individual works. If the motivations of public and nonprofi t employees indeed diff er, a diff erent management style is needed in order to ensure employee satisfaction and improve performance (Kristof-Brown, Zimmerman, and Johnson 2005).

Opportunities for Career AdvancementPublic organizations rely on a hierarchical form to monitor the performance of employees and to promote effi ciency. Th is hierar-chical form also creates a clear progression for employees who are motivated by the opportunity to advance to higher levels of the organization. Given this, opportunity for advancement often is used as an important incentive to recruit and retain capable workers in government agencies. Although the organizational outputs of gov-ernment agencies also provide psychological satisfaction to employ-ees, the infl exibility of the pay structure in government civil service systems forces the use of promotions as an incentive. (Kettl and Fesler 2005). Th erefore, supervisors rely on promotions to reward performance in the public sector.

On the contrary, DeVaro and Samuelson (2004) fi nd that promo-tions are less likely in nonprofi t fi rms than in for-profi t fi rms, even after controlling for worker, fi rm, and industry characteristics. Th ey argue that the output in many nonprofi t organizations is typically something of intrinsic interest to the workers, and incentives in those organizations are in some sense created “automatically.” Th is allows, they conclude, nonprofi t employers to use promotions as a tool for job assignment, but not as an incentive mechanism. Th is research leads us to hypothesize that managers seeking to move up in an organization are more likely to work in the public sector than in the nonprofi t sector.

If diff erent motivational factors aff ect the decision to work in each sector, we need to understand specifi cally how these two types vary. We contend that the diff erences between the sectors infl uence the provision of intrinsic and extrinsic rewards and, ultimately, an indi-vidual’s choice of employment sector. Recognizing the motivational diff erences and their implications will help management in public and nonprofi t organizations in fi nding a better person–organization fi t, therefore improving the recruitment and retention of employees (Bright 2008; Houston 2009).

Intersectoral Differences: Public and Nonprofi t SectorsDespite some commonalities, the literature suggests that there also are many diff erences between the public and nonprofi t sectors (Brown et al. 2000; Goodin 2003; Kearns 1994). Th e diff erences between the two sectors create distinct environments for the provi-sion of extrinsic and intrinsic rewards. In turn, the provision of these rewards aff ects the ability of the organization (public or non-profi t) to attract employees. Th e discrepancies between these sectors are rooted primarily in the unique legal environment in which nonprofi t organizations function. Th is legal environment mandates how the earnings of nonprofi ts can be distributed and the purposes they must serve.

Restrictions on how nonprofi ts can distribute profi ts stem from the nature of the organizations and eff orts to monitor how resources are distributed. In for-profi t organizations, a connection exists between the interests of stockholders, employees, and consumers, which ensures the effi cient distribution of resources (Hansmann 1980; Leete 2001; Mirvis and Hackett 1983; Preston 1989). Similarly, there is a bond between voter-constituents and the public servants who work in public organizations that encourages the effi cient or equitable distribution of resources (Mirvis and Hackett 1983). In the nonprofi t sector, scholars argue that it is more diffi cult to moni-tor and measure managerial success because of the lack of straight-forward measures of performance and electoral control, a result of the detachment of board of trustees from day-to-day management (Handy and Katz 1998; Mirvis and Hackett 1983). Given the dif-fi culty of monitoring, federal and state laws prohibit incorporated nonprofi ts from distributing net earnings to members, offi cers, or trustees. Th is constraint infl uences nonprofi ts’ structure and the extrinsic incentives, such as salary and benefi ts, that they are able to off er to employees, and ultimately could aff ect whether an indi-vidual chooses to work in a nonprofi t organization.

Another unique characteristic of nonprofi t organizations is the role that tax policy plays in the founding of the organization. To qualify for a tax exemption, nonprofi t organizations must demon-strate that they serve a public purpose (Boris and Steuerle 2006). Although public organizations and nonprofi ts organizations both exist to provide collective goods and to benefi t the public, the way in which the two sectors fulfi ll these requirements is quite dif-ferent. Public organizations are established by law, and they are publicly funded to implement the policies adopted by democrati-cally elected offi cials. As such, public organizations are expected to spread resources evenly over aff ected populations (Lipsky and Smith 1989). On the contrary, the clientele of a nonprofi t tends to be more narrowly defi ned. Most nonprofi t organizations serve a specifi c group of clients, such as the homeless, those with certain diseases, or children with disabilities. Th is stems from the fact


levels of job responsibility. In fact, in a survey of managers across the public, for-profi t, and nonprofi t sectors, Mirvis and Hackett (1983) and Mirvis (1992) have found that nonprofi t employees report the most variety and challenge in their jobs, as well as the highest levels of autonomy. Similarly, in a survey of Australian nonprofi t workers, Onyx and Maclean (1996) confi rm that nonprofi t workers choose their sector of work in part based on the opportunities for interest-ing and challenging work and the opportunities to work indepen-dently. Th ese fi ndings lead us to expect that managers working in the nonprofi t sector will be motivated by the high level responsibil-ity they fi nd in their work.

H4: Th e more managers are motivated by the desire for increased responsibility, the more likely they are to work for a nonprofi t fi rm.

Family-Friendly PoliciesIncreasing pressures to attract and retain talented employees have forced many public, nonprofi t, and private organizations to develop policies and programs aimed at providing employees with resources to balance their work and family responsibilities. Flexible schedul-ing, child or elder care provisions, and condensed workweeks are common examples of such programs. Although research on the provision of family-friendly benefi ts by sector is limited, researchers have found that nonprofi t organizations tend to off er more of these types of policies (Hakim 2000, 2006; Hohl 1996; McKenney 2007; SHRM 2001). For example, Hohl (1996) found that 85 percent of the 156 nonprofi t organizations surveyed off ered one or more of eight diff erent fl exible work arrangements. In addition, the 2001 Society of Human Resource Management (SHRM) annual ben-efi ts survey found that 61 percent of nonprofi t respondents off ered fl extime, and nearly a third (31 percent) off ered telecommuting and compressed workweeks, compared to 58 percent and 31 percent of for-profi ts companies, respectively.

As a matter of fact, some scholars posit that the availability of these benefi ts helps explain the overrepresentation of women in the non-profi t sector. Hakim (2000) argues that women are employed in the nonprofi t sector in higher percentages than men because nonprofi t organizations have more family-friendly policies than the other sectors. However, there is some evidence that this perception may be unfounded when the nonprofi t and public sectors are compared. Barbeito and Bowman (1996) found that 9 percent of nonprofi ts off ered child care, while 55 percent of state and local governments provided some child care benefi ts. Similar diff erences were found in the provision of fl extime arrangements. Riccucci (2002) reports that aside from the entertainment and recreation industry in the private sector, federal employees represent the second-largest cohort of workers relying on fl exible work schedules. In addition, the 2009 SHRM benefi ts survey reports that, compared to for-profi t and nonprofi t organizations, government agencies were more likely to off er telecommuting on a full-time basis and a compressed work week. Nevertheless, many people tend to associate the nonprofi t sector with work environments that are friendlier to families. Th is perception could be attributable to the fact that the types of policies are much broader than what is measured and may suggest an overall environment that is more tolerant of “motherhood, long parental leaves, part-time hours of work, and family friendly arrangements” (Hakim 2006).

H1: Th e more managers are motivated by the desire for ad-vancement within the organization, the less likely they are to work for a nonprofi t fi rm.

Salary and PensionAlthough both public and nonprofi t employees are thought to be less motivated by monetary incentives, pay in the nonprofi t sector historically has been lower than in the public sector, as well as in the private sector (Frank 1996; Leete 2001; McMullen and Schellenberg 2003; Salamon and Sokolowski 2006; Weisbrod 1983). Scholars have proposed numerous explanations for the lower wages in the nonprofi t sector. First, the nondistribution restriction on nonprofi ts acts as an economic constraint on the earning potential of nonprofi t employees by limiting the distribution of profi ts to employees. Second, labor donation theory views lower pay as the result of non-profi t employees’ donating part of their labor in order to produce social goods (Preston 1989). Similarly, Hansmann (1980) argues that individuals who are interested in accomplishing meaningful goals other than monetary compensation sort themselves into the lower-paying nonprofi t sector to work on the causes they believe in. Finally, Handy and Katz (1998) explain the lower wages in the nonprofi t sector with the concept of adverse selection. According to these authors, nonprofi t fi rms tend to pay their employees less as an attempt to promote self-selection of committed candidates (Handy and Katz 1998). Given these fi ndings, we expect to fi nd that nonprofi t managers are less motivated by salary than public sector managers.

H2: Th e more managers are motivated by salary, the less likely they are to work for a nonprofi t fi rm.

Similar to salary, the availability of pension and retirement plans is also a factor in motivating individuals to seek employment in the public sector. Th e pension and retirement plans off ered to public sector employees are thought to be superior to those off ered in other sectors. In addition, the provision of retirement benefi ts is somewhat ubiquitous in the public sector, whereas private for-profi t and nonprofi t organizations tend to lag behind (Barbeito and Bowman 1998; Moore 1991; U.S. Department of Labor 2006). For example, Barbeito and Bowman (1998) report that state and local governments and the federal government off er retirement plans to 96 percent and 100 percent of workers, respectively. In contrast, approximately 60 percent of nonprofi ts off er retirement benefi ts to their employees. We expect that the gap between the provision of retirement plans in the public and nonprofi t sector will motivate some managers to seek employment in public sector.

H3: Th e more managers are motivated by pension and retire-ment plans, the less likely they are to work for a nonprofi t fi rm.

Job ResponsibilityIndividuals may also perceive a diff erence in the level of job respon-sibility off ered by public and nonprofi t sector employment. Surveys have found that professionals and managers view working for the government as constraining, with more rules and procedures and less independence and responsibility (e.g., Anechiarico and Jacobs 1996; Benveniste 1988; Kilpatrick, Cummings, and Jennings 1964). On the other hand, nonprofi t employees are thought to enjoy high


H7: Managers who report volunteering are more likely to work for a nonprofi t fi rm.

Data and MethodTh is research uses data from the National Administrative Studies Project III (NASP-III), a survey administered by Barry Bozeman and his colleagues in 2005. Th e survey contains information about public and nonprofi t managers’ career histories, hiring practices, and organizational environment in the states of Georgia and Illinois. Among 1,220 returned surveys, 790 were from public agencies and 430 were from nonprofi t organizations. Th e public sector response rate was 43, and the nonprofi t sector rate was 33 percent. Th e NASP-III coding rules require the sector to be coded as “nonprofi t” even if the respondent indicated that the organiza-tion is public but the organization fi led a tax form (Form 990) indicating nonprofi t status. Meanwhile, if the respondent indicated that the organization is “nonprofi t” but did not submit nonprofi t tax forms, the sector was coded as either “private” or “public,” depending on the way the organization funded its activities. After this process, our sample includes 797 public managers and 275 nonprofi t managers.

In the survey, respondents were given a list of motivation items and asked to indicate “the extent to which the factors below were important in making your decision to take a job at your current organization.” Th e managers then rated each motivation item on a four-point Likert scale: “not important,” “somewhat unimportant,” “somewhat important,” and “very important.” In addition, they were asked to provide demo-graphic information such as age, sex, ethnic-ity, educational background, and employment history.

As previously stated, the logic behind analyz-ing sector choice is that people choose to

work in a sector in which they expect to receive most of the extrinsic and intrinsic rewards they consider important. For example, those who place greater value on a family-friendly environment will choose to work in the sector that they think will provide more of it (Lewis and Frank 2002). In the same way, those who place greater value on monetary rewards would want to work in the better-paying sector given their characteristics, all else being equal.

Dependent VariableIn order to see whether the respondent currently works in the public sector or in the nonprofi t sector, the research uses probit analysis. Th e dependent variable is binary, whose value is 1 if the respondent works in the nonprofi t sector and 0 if he or she works in the public sector.

Independent VariablesIndependent variables include seven job motivation items. As mentioned, the respondent was asked to rate how important each of the job motivation factors had been in the decision to accept a job at his or her current organization on a four-point Likert scale.4 Th e seven motivational items used in this analysis include the following:

H5: Th e more managers are motivated by family-friendly poli-cies, the more likely they are to work for a nonprofi t fi rm.

Public Service Motivation and VolunteeringAccording to Deci and Ryan, individuals have diff erent kinds of intrinsic needs and orientations, and “these intrinsic needs provide energy for them to act on the environment and manage aspects of their drives and emotions” (1985, 4). Th e assumption underlying the research on public service motivation is that individuals working in government demonstrate a commitment to the public interest, a desire to serve others, and self-sacrifi ce (Houston 2006). Given these characteristics, numerous scholars have argued that public employ-ees are motivated less by material rewards and more by psychologi-cal rewards, such as serving the public interest (Cacioppe and Mock 1984; Crewson 1997; Lewis and Frank 2002; Perry and Wise 1990; Rainey 1982; Vandenabeele, Hondeghem, and Steen 2004; Wittmer 1991). Th ere is evidence that public employees place a higher value on helping others, serving society, and performing work that is benefi cial to society.

Th e importance of the diff erent dimensions of PSM may vary across organizational settings. Provided that the intrinsic motivation of non-profi t employment is diff erentiated from PSM, what is this unique nonprofi t motivation? As we discussed earlier, nonprofi t organizations tend to serve a more narrowly defi ned clientele, often sacrifi cing equity for responsiveness (Lipsky and Smith 1989). In this sense, we argue that broader measures of the desire to serve the public are closely related to work associated with govern-ment, whereas narrower measures related to specifi c prosocial behaviors, such as volunteer-ing, may be better for capturing the motivation of individuals to work in the nonprofi t sector.

Light (2002) reports that nonprofi t employees are much more likely than their for-profi t and public sector counterparts to cite as reasons for taking their current job the desire to make a diff erence and to do something worthwhile. Prosocial behaviors such as volunteering are closely related to these motivations. Several studies of voluntarism have found that public sector employees are more likely to volunteer than for-profi t sector employees (Houston 2006; Rotolo and Wilson 2006; Wilson and Musick 1997). However, in their analysis of data from the 2002 Current Population Survey Volunteer Supplement, Rotolo and Wilson (2006) found that nonprofi t workers were more likely to vol-unteer than those who were employed in for-profi t and government organizations, even after controlling for personal characteristics. Light (2002) also reports that nonprofi t employees volunteer at a higher rate than public employees.3 Th is leads us to argue that volun-tarism may be a better way to capture a unique nonprofi t motivation that may be overlooked by broader measures of public service moti-vation. Based on the nature of nonprofi t organizations, we hypoth-esize that nonprofi t managers are less likely to be motivated by the desire to serve the public, but they are more likely to volunteer.

H6: Th e more managers are motivated by the desire to serve the public and public interest, the less likely they are to work for a nonprofi t fi rm.

The importance of the different dimensions of [public service motivation (PSM)] may vary across organizational settings.

Provided that the intrinsic motivation of nonprofit

employment is differentiated from PSM, what is this unique

nonprofit motivation?


that whites accounted for 84 percent of the nonprofi t workforce, while about 70 percent of the entire U.S. population were white.

Education level. Research has found that nonprofi t workers tend to have a higher level of education. For example, Mirvis (1992) found that many more college graduates and those with postgraduate education were employed in the nonprofi t and government sectors than in the for-profi t sector. Johnston and Rudney’s (1987) fi ndings show that nonprofi t workers tend to be both less educated and more educated than other workers.

Martial and parental status. Being a parent changes many deci-sions in a person’s life, not to mention one’s career choice. It is expected that the importance of family-friendly policies depend on whether a respondent is a parent. Moreover, because women’s role as a primary caregiver to children or other family members aff ects their decisions in the labor market (Becker 1985; Crosby, Williams, and Biernat 2004; Ridgeway and Correll 2004), parent status may have greater infl uence on women’s perception of the importance of family-friendly policies than on men’s. To see the diff erence between men and women, an interaction term (female * children) is included in the equation.7

FindingsDescriptive StatisticsTable 1 shows the comparison between public managers and non-profi t managers in the sample on demographic characteristics and the importance they placed on each motivation item. Nonprofi t managers were more likely to be female and older compared to public managers, although the diff erence was relatively small. Th ey were less likely to have only a high school or college education, but more likely to have a master’s or advanced degree than public man-agers. Th e percentage of managers with children was higher among public managers, and so was the percentage of nonwhite workers. Th e proportion of nonwhite managers was far greater for the public sector, probably because of the better-established practice of nondis-criminatory policies in government. Nonprofi t managers were much more likely to be volunteers than public managers.

Th e bottom rows of table 1 display descriptive diff erences in job motivational items between public and nonprofi t managers. In terms of their desire for advancement within the organizational hierarchy, public managers valued the opportunity for advancement more than nonprofi t managers. Nonprofi t managers regarded salary as a more important motivator than public managers. With regard to pen-sion and retirement plans, public managers treated them as more important in the decision to take a job in their current organization. Nonprofi t managers valued increased responsibility more than pub-lic managers. Th ere seems to be no visible diff erence between public and nonprofi t managers in how important family-friendly policies were in their decision to accept the current job. Th is rough descrip-tion of demographic and motivational diff erences suggests that there may be signifi cant diff erences between public and nonprofi t workers.

Probit Regression ResultWe estimated a probit regression to measure the probability of nonprofi t employment for the managers. Th e dependent vari-able is binary, coded 1 if a respondent works in the nonprofi t sector and 0 if he or she works in the public sector. With a binary

1. Opportunity for advancement within the organization’s hierarchy

2. Salary3. Th e organization’s pension or retirement plan4. Desire for increased responsibility5. “Family-friendly” policies6. Ability to serve the public and the public interest5

7. Volunteering

Most of our independent variables are ordinal, which means that there is a clear ordering of the variables. However, the intervals between the values are not necessarily equally spaced—that is, the diff erence between “important” and “somewhat important” may not be equal to the diff erence between “not important” and “somewhat unimportant.” In this case, treating them as interval variables may result in bias (Long and Freese 2006; Walter, Feinstein, and Wells 1978; Winship and Mare 1984). For better estimation, all of the motivational items are dummy coded, with the “not important” category as the reference group (not reported).6

In the case of volunteering, we use a dichotomous measure of whether the respondent had participated in volunteer work in the last four weeks. Th is measure is somewhat problematic. Ideally, we would have a measure that asked whether the respondent had volunteered prior to entering the workforce. Th is would be useful so that we could disentangle volunteering outside the job versus volun-teering as part of the respondent’s employment, which is particularly important for nonprofi t employees. Given this, our current mea-sure only allows us to test whether volunteering is correlated with employment in either sector.

Control VariablesGender. In addition to the motivational factors, we also include several control variables that may be related to sector choice. Th e nonprofi t sector historically has been an important employer of women (Preston 1994). In the United States, women have been active members of voluntary associations by launching local chari-ties, participating in suff rage movements, and creating philanthropic ventures (McCarthy 1994). Recent statistics show that of all non-profi t employees, women account for 68 percent, although a small variation exists among the subsectors (Halpern 2006; Independent Sector 2002; Light 2002).

Age. Researchers have examined whether there is an age diff er-ence among employees of diff erent sectors, and many have found a signifi cant diff erence (Cornille et al. 2006; Mirvis 1992; Mirvis and Hackett 1983). For example, Mirvis (1992) and Mirvis and Hackett (1983) report that a smaller proportion of younger (under 24) and older (over 55) workers were employed in the nonprofi t sector than in government and for-profi t fi rms. We include both age and age-squared to examine whether there is a nonlinear relationship between age and the likelihood of working in the nonprofi t sector.

Race. Th e literature suggests that one’s race is related to the sector of employment (Blank 1995; Cohen 1993). For instance, Cohen’s (1993) analysis of alumni of a New York undergraduate business college revealed that black alumni were substantially more likely to work in government than their white counterparts. Light’s (2002) analysis of the random sample of 1,140 nonprofi t workers reports


Generally speaking, one’s demographic characteristics seem to have little impact on one’s choice between public and nonprofi t employ-ment. Neither the gender nor age of a manager aff ected the likeli-hood of working in the nonprofi t sector. Th ere was not a signifi cant relationship between one’s household characteristics (marital status and the presence of children) and sector choice. Only one aspect of

demographic characteristics, one’s race, was a signifi cant predictor of the choice. Nonwhite managers were 16.3 percent less likely to work in nonprofi t organizations than in state governments. As mentioned previously, this may be attributable to more established equal opportunity practices and affi rmative action in government compared to the private sector.

Our fi rst hypothesis was that those who value opportunities for advancement within the organization are less likely to work in the

dependent variable, a linear probability model has many drawbacks (Wooldridge 2009). Th e probit regression uses maximum likelihood estimation, which is consistent, asymptotically normal, and effi cient under very general conditions (Wooldridge 2002).

As explained, the treatment of ordinal variables as continuous may result in bias in estimation. Instead, we used three dummy variables for each motivation (using the “not important” category as the reference group) and compared the diff erences in their eff ects on the probability of accepting a job in the nonprofi t sector. Table 2 shows the average marginal eff ects of the predictor variables on the dependent variable. In other words, it displays changes in the likelihood of accepting a nonprofi t job as one independent variable increases by unity (a change from 0 to 1 in the case of nominal variables).8

Table 1. Descriptive Statistics: Public Managers versus Nonprofi t Managers

Variable Public Sector (N = 748) Nonprofi t Sector (N = 243)

Female 43.9% 49 .4%

Age 48.9 (8.58) 50.1 (9.2)

High school graduate only 15.6% 11.1%

Bachelor’s degree only 42.1% 34.6%

Master’s or professional degree 42.0% 53.1%

Married 78% 78.2%

Children 52.8% 48.1%

Nonwhite 18.7% 4.1%

Has volunteered 55.7% 72.8%

Opportunity for advancement within the organization’s hierarchy

Not important 10.2% 27.2%

Somewhat unimportant 9.9% 12.8%

Somewhat important 46.0% 41.2%

Very important 34.0% 18.9%

Salary





Organization’s pension or retirement plan





Desire for increased responsibility





Family-friendly policies





Ability to serve the public and the public interest





Generally speaking, one’s demographic characteristics seem to have little impact on

one’s choice between public and nonprofit employment.


nonprofi t sector. Th e probit results show fi ndings consistent with our hypothesis. Th e more a manager values those opportunities, the less likely he or she is to work in a nonprofi t organization. Compared to those who said that promotion opportunities were not important, respondents who indicated that advancement was “somewhat unimportant” were 9.6 percent less likely to work in the nonprofi t sector. Respondents who answered that advancement was “somewhat important” were 13.2 percent less likely to work in nonprofi t organizations, and those who answered that it was very “important” were almost 20 percent less likely to do so. Managers who value opportunities for advancement tend to prefer working in state governments rather than nonprofi t organizations.

Th e second hypothesis predicted that those who are motivated by salary are less likely to work in the nonprofi t sector. Th e statisti-cal analysis, however, suggests no signifi cant relationship between preference for monetary rewards and the likelihood working in the nonprofi t sector versus the public sector. In other words, the impor-tance of monetary compensation in one’s decision to accept the job does not predict whether the person works in a nonprofi t organiza-tion or in state government.

We also hypothesized that people who place greater value on pen-sion and retirement plans are less likely to work in the nonprofi t sec-tor. Th e fi ndings are consistent with our hypothesis. Compared to the managers who said that pension and retirement packages were not important in their decision to accept their current job, those who said they were “somewhat unimportant” were 11.5 percent, those who said they were “somewhat important” were 17.5 percent, and those who said they are “very important” were 35.1 percent less likely to work in nonprofi t organizations. For those who desire a pension and retirement plan, state government agencies are more attractive employers than nonprofi t organizations.

Th e fourth hypothesis stated that people who place more impor-tance on increased responsibility are more likely to work in non-profi t organizations. Consistent with our hypothesis, people who responded that the increased responsibility was very important in their decisions to accept a position were almost 25 percent more likely to work in the nonprofi t sector, although those who said that responsibility was “somewhat important” or “somewhat unimpor-tant” were not more likely to work in the nonprofi t sector than in the public sector. When managers who consider increased responsi-bility very important, they tend to prefer working in nonprofi ts.

We also hypothesized that people who are motivated by family-friendly policies are more likely to work in the nonprofi t sector. For the managers for whom family-friendly policies were “somewhat unimportant” in their acceptance of the current job, they were 12.3 percent more likely to work in the nonprofi t sector compared to those who said that these policies were not important. For those who said that these policies were “somewhat important” or “very important,” 13.3 percent and 17.4 percent were more likely to work in nonprofi t organizations, respectively. Th erefore, managers are more likely to work in nonprofi t organizations the more they value family friendly policies.

Th e sixth hypothesis was that managers who value the ability to serve the public and public interests more are less likely to work in

Table 2. Average Marginal Effect after Probit (Y = probability of nonprofi t employment)

Variables Coeffi cient (S.E.)

Female .041 (.037)

Bachelor’s degree –.018 (.037)

Master’s or professional degree .033 (.039)

Married –.007 (.030)

Children –.014 (.035)

Female * children .006 (.049)

Nonwhite –.163*** (.025)

Age –.009 (.012)

Age2 .000 (.000)

Has volunteered .101*** (.027)

Opportunity for advancement within the organization’s hierarchy

Somewhat unimportant –.096** (.036)

Somewhat important –.132*** (.031)

Very important –.195*** (.027)

Salary Somewhat unimportant –.013

(.081) Somewhat important .039

(.078) Very important .102

(.086)Organization’s pension or retirement plan Somewhat unimportant –.115**

(.037) Somewhat important –.175***

(.035) Very important –.351***

(.026)Desire for increased responsibility Somewhat unimportant .027

(.067) Somewhat important .084

(.059) Very important .247**

(.071)Family-friendly policies Somewhat unimportant .123*

(.051) Somewhat important .133**

(.046) Very important .174***

(.050)Ability to serve the public and the public interest Somewhat unimportant –.115**

(.040) Somewhat important –.109**

(.039) Very important –.179***

(.035)

*p ≤ .05; **p ≤ .01; ***p ≤ .001. McFadden’s Psuedo-R2 = .2622 LR Chi2 = 284.34***


literature on person–organization fi t suggests that the fi t between organizational values and personal values aff ects job satisfaction, and thus both one’s performance and willingness to stay in the organization (Kristof-Brown, Zimmerman, and Johnson 2005; Naff and Crum 1999). As a consequence, sector-specifi c management practices and incentive structures are needed in order to motivate managers in the public and nonprofi t sectors. Th is realization is particularly important given the likely “human capital crisis” that the federal government is facing and the increasing evidence that employees are willing to shift between sectors.

Next, this research also found that participation in volunteering is positively associated with nonprofi t employment, while the inten-tion to serve the public and public interests increases the likelihood of public sector employment. We propose that the idea behind volunteering may be a potential candidate for the search for a mea-sure of intrinsic motivation of nonprofi t employment. Although the possibility of endogeneity (i.e., the possibility that nonprofi t employment increases participation in volunteering, not vice versa) exists in our analysis, it is worth studying the relationship between volunteering and nonprofi t employment. Future research on this topic could examine the relationship between childhood or adolescent volunteering experience and nonprofi t employment in adulthood.

Finally, the literature suggests that PSM is a broad, multifaceted concept (Brewer, Selden, and Facer 2000; DeHart-Davis, Marlowe, and Pandey 2006; Pandey and Stazyk 2008; Perry 1996; Rainey 1982). For instance, Brewer, Selden, and Facer (2000) divide PSM into four distinctive conceptions—Samaritans, communitarians, patriots, and humanitarians. Perry (1996) develops four diff erent dimensions of PSM, including public policy making, public inter-est, compassion, and self-sacrifi ce. Similarly, DeHart-Davis, Mar-lowe, and Pandey (2006) categorize PSM into three motivational dimensions: compassion, attraction to policy making, and commit-ment to public service. Th e motivation behind nonprofi t employ-ment may overlap with several dimensions of PSM given that both public and nonprofi t organizations produce public goods and serv-ice. In fact, Houston (2008) fi nds that public and nonprofi t workers show similar patterns of PSM-related attitudes. Th e fi ndings in this research, nevertheless, suggest that the intrinsic motivation of public and nonprofi t employees may, though similar in multiple aspects, not be identical. Future research should investigate how specifi cally the intrinsic motivations of the two types of employees diff er and overlap with each other.

AcknowledgmentsTh e authors are grateful to the referees and the editor for their insightful comments on the paper.

Notes1. Th ere are other factors, such as labor force needs and discrimination, that push individuals out of an employment sector. However, these factors are beyond the scope of this study.2. Career advancement also could be an intrinsic reward because a promotion provides an employee with a feeling of achievement. We choose to treat it as extrinsic

nonprofi t organizations. Th is hypothesis tests whether a particu-lar dimension of public service motivation, defi ned as “the ability to serve the public and public interests,” is an exclusively public sector value. If the ability to serve the public and public interests is also a motivational basis of nonprofi t employees, there should be no signifi cant diff erence in the likelihood as the importance of this motivation in the acceptance of the job. Th e results show that managers who indicated that the ability to serve the public was “very important” were 17.9 percent less likely to work in nonprofi ts compared to those who regarded it as unimportant. Managers who said that it was “somewhat unimportant” and those who said that it was “somewhat important” were 11.5 percent and 10.9 percent less likely to work in nonprofi ts, respectively. Th e negative relation-ship between this motivation item and the likelihood of working in nonprofi ts suggest that there are signifi cant diff erences in the intrinsic motivations of public and nonprofi t employees. Although a majority of nonprofi t organizations are engaged in providing public goods and serving public interests, this particular aspect of public service motivation may not be related with intrinsic motivation for nonprofi t employment.

Where can we fi nd the distinctive nonprofi t motivation? We argue that the unique nonprofi t motivation be found in prosocial behav-iors such as volunteering. Compared to those who did not volun-teer, people who volunteered were more than 10 percent more likely to work in the nonprofi t sector. Volunteer activities typically involve helping others at a more micro level than government programs. Although it is not clear whether motivation behind volunteering truly predicts nonprofi t employment or whether nonprofi t employ-ment promotes volunteering, the positive relationship between volunteering and nonprofi t suggests that further research on this issue is worthwhile.

ConclusionTh is article has examined how seven motivational aspects correlate with the choice between public and nonprofi t employment. We hypothesized that the diff erences between the sectors impact the provision of intrinsic and extrinsic rewards and ultimately infl uence an individual’s choice between employment sectors. Our fi ndings show that the motivational correlates of working in the public sector are diff erent from those of working in the nonprofi t sector. Specifi cally, public managers seem to value the opportunity for advancement within the organization’s hierarchy, its pension and retirement plan, and the ability to serve the public and the public interest. Nonprofi t managers seem to desire increased responsibil-ity and family-friendly policies. We contend that despite some commonalities, there also are many diff erences between the public and nonprofi t sectors. Th e diff erences between the two sectors create distinct environments and aff ect the ability of the organization (public or nonprofi t) to attract employees.

Th e fi ndings of this research are important for several reasons. First, diff erences in motivation suggest that diff erent systems of rewards and incentives should be used to recruit and retain productive workers (Borzaga and Tortia 2006; Burgess and Ratto 2003; Deci 1971). Th e

We contend that despite some commonalities, there also are many differences between the public and nonprofit sectors. The differences between the two sectors create distinct

environments and affect the ability of the organization

(public or nonprofit) to attract employees.


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3. However, Houston (2005, 2008) fi nds no diff erence in individual philanthropy, including the donation of time and money.

4. Th e structure of this question requires that respondents comment in the present on what motivated them to make a past decision. As an anonymous reviewer pointed out, there could be some postdecision rationalization on the part of the respondent. We agree that there could be some recall errors, but we cannot control for this error and believe that it is a random error in the sample.

5. Th e research on public service motivation has developed numerous scales and dimensions to measure public service motivation. We recognize that using a single item to capture this is not ideal, but we feel that the measure allows us some insight into the relationship between the desire to serve the public interest and job choice.

6. Some scholars claim that ordinal variables can be treated as interval-level variables because of the convenience of explanation and fl exibility gained from this method. Other scholars however, warn about the biases in using continuous-variable methods for ordinal variables. In the case of Likert scales, an underlying, continuous variable denoting degrees of importance is “mapped into categories that are ordered but are separated by unknown distances” (Winship and Mare 1984, 513). Treating ordinal variables as continuous variables may result in bias when the ordered variable (expressed in a Likert scale) is nonlinearly related to an unobserved continuous variable (Winship and Mare 1984). Wooldridge (2009) points out that the appropriate way to treat this type of variable is to create a dummy for each rating class. In addition, it is not likely that we are overfi tting the model by throwing in numerous dummy-coded variables, as the pseudo-R2 values for the model with dummy independent variables and continuous inde-pendent variables are not very diff erent (0.2390 and 0.2622, respectively). Th e sizes of the coeffi cients in table 2 (when we treat the independent variables as ordinal variables) are not homogeneous across the levels, which suggests that the likelihood of working in either the public or nonprofi t sector does not change in a linear fashion.

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A Call for Papers, Posters and Symposia…

“Improving the Quality of Public Services”June 28-29, 2011

A Multi-National Conference hosted by:State University – Higher School of Economics Moscow, Russia

In association with the University of Maryland School of Public Policy

and the Association for Public Policy Analysis and Management

Public desire for better government services is universal, but approaches and outcomes vary dramatically from country to country. Much has been learned about the factors that infl uence effi ciency, eff ectiveness,

equity, and responsiveness in public service design. Lessons emerging from developing and transition countries have the potential to shed new light on long-standing questions about public service performance.

For more information, visit:http://www.umdcipe.org/conferences/moscow/moscowmain.html

more similarities or more differences comparing public and

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