Signs You Need to Restructure: Overstaffing – Episode 252 | The Unstuck Church Podcast

signs to restructure overstaffing

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Signs You Need to Restructure Your Staff (Part 1)

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There are some staffing strategies that tend to produce health and growth for churches. There are also some staffing strategies that, more often than not, are part of the reason why churches get stuck.

Staffing is typically the biggest financial investment that churches make to accomplish their mission. So, as the reality of our post-pandemic world has come into focus, many pastors are revisiting their staffing and structure—and this should be a concern for every church right now… even if you’ve come out of the last couple of years in a relatively healthy financial position. In this podcast series, we’ll walk through a number of early warning signs that it’s time to address staffing issues and restructure in your ministry team.

(Listen to Part 2 on warning signs related to legacy structure, Part 3 on warning signs related to leadership capacity, and part 4 on warning signs related to lack of alignment and span of care.)

OVERSTAFFING IN CHURCHES

Churches generally have lower attendance than they had three years ago, but they haven’t reduced staffing to reflect the current attendance patterns. This overstaffing also means they’re either over budget for staffing costs, or that they’re not paying their current staff enough. In this episode, we’ll discuss these issues and unpack:

  • A healthy ratio of staff to attendance—and the ratio we’re actually seeing
  • A healthy budget for staffing (and why most churches are exceeding it)
  • How staff compensation effects ministry health
  • One big staffing dichotomy between healthy and stuck churches
If you haven’t right-sized your staff team to fit the current size of your church, now is the time. [episode 252] #unstuckchurch Click To Tweet Healthy churches hire fewer staff and pay those staff well. Stuck churches, on the other hand, tend to hire more staff and pay everyone less. [episode 252] #unstuckchurch Click To Tweet The staff in stuck churches tend to have a  bias towards hiring more staff rather than engaging more volunteers. [episode 252] #unstuckchurch Click To Tweet It’s time for churches to right-size their staffing budget to create an appropriate financial margin that allows them to fund the church’s mission. [episode 252] #unstuckchurch Click To Tweet
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The Church Lawyers’ Client Member program was created for organizations just like yours.  Their team of Christian legal professionals are personally called to empower and protect churches, ministries, and their leaders to fulfill their mission by providing biblically informed and ministry-focused legal solutions.  

Whether governance, employment, litigation, or other matters, let The Church Lawyers walk alongside you as you navigate legal issues facing your ministry.  Sign up for the The Church Lawyers’ Client Member program today at thechurchlawyers.com.


[Free Webinar] How to Restructure Your Church Staff

 

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Transcript

Tony (00:00):

The Church Lawyer’s Client Member Program was created for organizations just like yours. Their team of Christian legal professionals are personally called to empower and protect churches, ministries and their leaders. They want to help you fulfill your mission by providing Biblically informed and ministry focused legal solutions. Whether it’s governance, employment, litigation or other matters, let The Church Lawyers walk alongside you as you navigate legal issues facing your ministry. Sign up for The Church Lawyers Client Member Program today at thechurchlawyers.com.

Sean (00:36):

Welcome to The Unstuck Church Podcast, where each week we are exploring what it means to be an unstuck church. The greatest single investment of resources in your church is in your staff. And we’ve learned in over a decade of working with churches, that your staffing structure is a key strategy to accomplishing your mission. But on this side of the pandemic, more churches find themselves with staffing challenges than ever before. On this week’s podcast, Tony and Amy start a four week series on “The Signs Your Church Needs to Restructure” with a conversation about how to know when your church is overstaffed. Make sure before you listen though, to subscribe to get the show notes in your email. You’re gonna get tools to go along with each week’s conversation, all of the resources that we mention and access to our archive of podcast resources from past episodes. Sign up by going to theunstuckgroup.com/podcast. Now let’s join Tony and Amy for this week’s conversation.

Amy (01:34):

Well, Tony I’ve loved the podcast series we’ve done the last couple of months. We had a number of great interviews back in May on preaching and teaching. And then I think the most recent series was so helpful to encourage pastors and church leaders in this unique season. However, I’m kind of ready to get back to topics that are more focused on the work we do on a weekly basis with the churches throughout North America.

Tony (01:55):

Yeah, I agree. I mean, this is kind of like our meat and potatoes, I think, Amy. I don’t know. I mean, I love meat and potatoes. Do you love meat and potatoes?

Amy (02:04):

I love meat and potatoes.

Tony (02:05):

Okay. All right. Good.

Amy (02:05):

And they love me.

Tony (02:08):

Well, on that note, we’re going to spend these next four weeks talking about signs that you need to restructure your team. And, needless to say, over the last couple of years, we’ve talked a lot about some of the shifts that need to happen related to vision and ministry strategy on this side of the pandemic. But we haven’t talked much about needing to kind of address the staffing and structure changes that really may even be a higher priority for churches right now. In fact, I’m guessing many pastors think of The Unstuck Group as the organization that helps churches with mission and vision and ministry strategy. And that’s true. However, if you were to ask pastors, particularly of midsize or larger churches, what they have most valued about their experience engaging with our team, I would venture to say most of them would agree it was our help with staffing and structure that made the biggest impact. And by the way, Amy, if I haven’t mentioned this lately, I just want to thank you for designing such a comprehensive process to help pastors and church leaders with staffing structure. I mean, it’s the stuff most people in ministry never learned when they went to college or seminary. I mean, I have a business degree, but I only had one class on organizational structure. So, I just, I know that I’m biased, but I think there’s no other organization or denomination in North America that provides such practical advice in coaching when it comes to helping churches with their staffing structure and the custom staffing plans that we also provide. I mean, the process that you helped design, it’s really phenomenal and it’s helping hundreds of senior and executive pastors navigate the tough staffing conversations that they really need to have, especially in this season.

Amy (04:05):

Yeah. I’m biased, but I love the staffing and structure side. And by the way, it was a team of us who built this offering, but it is so helpful. Like you said, for pastors, they aren’t trained in organizational leadership, but they know something’s wrong. They can sense that. And when we get to the staffing and structure review, we finally kind of find a reveal of the things that they need to put attention on to have a healthier team. And when they do it, by the way, I love it. I love it. I love the life that’s breathed back into a team and an organization. So yeah. Well, will you explain what’s distinctive about how we approach our staffing and structure process compared to the assess and strategic planning portion of our process?

Tony (04:43):

Yeah, of course. And maybe I should explain it this way. When we help churches with vision and strategy and future direction, it’s intentionally a facilitator process. I mean, we really do let the Holy Spirit and the church’s leadership team guide the conversation. And mainly that’s because I learned a long time ago that there are many ways to build a healthy, thriving ministry that help churches really accomplish the gospel mission that God’s given us. In other words, there’s no one right way to build a healthy church. And because of that, when we plan, we facilitate a conversation, we don’t prescribe the solution. We really are more coaches than consultants in that part of our process. However, when it comes to staffing and structure, we take a different approach. We become much more prescriptive, and we share what we see working and not working in other church ministries. We provide clear recommendations for getting the right people in the right roles to move the church’s mission forward. And we provide a customized staffing plan for the future. And we do this because we know that for almost all churches, the staff team, it’s the biggest financial investment that the church is going to make. And we also know that getting staffing and structure right, it’s critical to helping the church maximize its kingdom impact. And Amy, speaking of being more prescriptive, I’ve been leading organizations for almost 30 years now. I really am getting old.

Amy (06:18):

Good job. Good job.

Tony (06:19):

And over the last 13 years, our team at The Unstuck Group, we’ve helped more than 600 churches now, I think, improve their staffing and structure to better align their team around their mission. And because of that, I’ve learned a thing or two about what works and doesn’t work when it comes to staffing and structure. In fact, Amy, do you remember a few months ago when I didn’t hold back on how different multi-site strategies don’t produce the same results. Do you remember when we talked about that?

Amy (06:48):

I do remember that. I do. Yes. Where are we going with this one? Are you gonna be a grumpy old man again?

Tony (06:54):

I might be a little bit grumpy here, yeah. Because I have some stuff I’d really like to get off my chest as it relates to staffing and structure, because again, staffing is typically the biggest financial investment that churches make to accomplish their mission. And yet, just like with multi-site strategy, there are some staffing strategies that tend to produce health and growth for churches. And there are also some staffing strategies that we see many, many churches trying to implement that, more oftentimes than not, are part of the reason why churches get stuck. And because of that, I have some honest, maybe pointed, thoughts to share over the next several weeks on this topic. But frankly, I’m just growing tired of seeing so many churches, essentially, I would characterize it as almost misusing kingdom resources in ways that constrain our ability to accomplish God’s mission for the church. And needless to say, I have a strong conviction that this is likely because it’s the biggest financial investment we make. It’s a huge stewardship responsibility that we have as pastors and church leaders. And we just need to be wiser about how we’re investing those kingdom resources.

Amy (08:11):

Well, you know, Tony, I share your passion on this topic, but I also know that you’re also very intentional about the themes that we discuss on this podcast. So I’m just curious why staffing and structure? And why right now?

Tony (08:23):

Yeah, so on this side of the pandemic, I’m guessing we’ve already helped more than a hundred churches revisit their staffing and structure. And we have pastors reaching out to us now almost daily from other churches that are also looking for help. And the volume of church leaders reaching out has certainly increased as the reality of our post pandemic world has come more into focus. And here’s kind of a sneak peek at what I’m hearing from pastors in recent conversations. The number one thing I’m hearing is this sense as pastors, they’re saying we’re overstaffed. We have the same number of staff and the same structure that we had before the pandemic. And now we’re just a much smaller church, but we’ve not adjusted our staffing numbers to compensate for that. Another theme that I’m hearing: we’re starting to experience financial constraints. And that has really picked up since the beginning of this new year. They’re saying things like this, though our giving was strong and our expenditures were down during the worst of the pandemic, and now we’re either spending down cash reserves or we’re having to cut ministry expenses to continue to make payroll. Or another thing I’ve heard commonly is our vision needs to change. Things are just different than they were a few years ago, and our ministry strategies need to change. And those same strategies that worked five or 10 years ago, they’re not going to work today. And therefore, we also think that the makeup of our team needs to change, or I’m hearing this, we’re really experiencing the impact of that great resignation at our church. And we’ve had a lot of staff turnover, and we think now is the time to right-size our staff team and prioritize those roles that will help us move forward on this side of the pandemic. And now we actually have the staff openings to allow for that type of change. Or in their honest moments, Amy, I’m hearing something like this. I’m just too close to our team to make the tough decisions that I know I need to make. And they’re saying things like several of our staff have been with us for many years, and therefore we have a legacy team that’s kind of operating in a legacy structure and several of them are ready and capable. They have the wiring to make the changes that are needed to help us in this new reality, but some just are either unwilling, or they lack the wiring needed, to help us going forward. And we need someone from the outside to help us with these tough calls. You know, if any of these thoughts have crossed your mind in recent days, just let me confirm you are certainly not alone. And when I hear this recurrent theme, like these, in my daily conversations that I’m having with pastors throughout North America, I know this is a conversation we also need to prioritize on this podcast.

Amy (11:27):

Well, with that introduction to this series, we’re gonna unpack a number of signs, really warning signs, that it’s time to address staffing issues and restructure your ministry team. And this week, the warning signs are all related to over staffing, Tony, and I assume that’s because you think overstaffing should be the most pressing concern for churches right now?

Tony (11:47):

Yeah, you’re correct. And I mean, I really do think this should be a concern for every church right now, even if you’ve come out of the last couple years and you’re still in relatively healthy financial position, if the forecasts are accurate and the early warning signs are real, we should be preparing for a pullback in the world’s economy in the coming months. In fact, I just read another article that several business leaders are predicting sometime in the beginning of 2023 is when we will officially be in our next recession. And eventually this is going to impact giving in churches as well. And I’m reading about business leaders that are preparing now for what they see coming into the future. And so now I think is the time for church leaders also to begin paying attention and taking some of the necessary precautions to just prepare for what we’re going to experience financially as churches.

Amy (12:47):

All right. So let’s dive in. What’s the first sign that it might be time for leaders to restructure their staff?

Tony (12:52):

Yeah, so the first sign that we haven’t right-sized our team to reflect the current size of our church. And I will just confirm that if the data in our recent Unstuck Church Report is accurate, then there are many churches right now that are overstaffed. The last report indicated that churches on average currently employ one full-time equivalent staff person for every 34 people in attendance. And I know, Amy, we’ve worked with some churches that are even well below that. In other words, they have more staff for fewer people attending the church, and that’s by far the lowest ratio compared to actual attendance that I’ve ever seen in my years of studying churches. And it’s also well below the target we recommended before COVID, which is closer to one full-time equivalent for every 75 people in attendance. And the healthiest churches we were seeing were commonly more like one full-time equivalent for every hundred people in attendance or better. So it’s fairly obvious churches generally have lower attendance than they had three years ago, but they haven’t reduced staffing to reflect their current attendance patterns. And may I be honest here?

Amy (14:15):

Yes.

Tony (14:15):

I thought you might say that.

Amy (14:17):

Yeah.

Tony (14:18):

The pandemic started nearly two and a half years ago. And if people haven’t come back to your church, they’re not coming back. So should we continue trying to reach new people with the good news of Jesus Christ? Absolutely. But because we are now well into year three of our new normal, you’re very likely experiencing also your new financial reality, and the indicators for the near future suggest that if anything, we’re heading into a pullback in the economy, which will certainly impact giving in your church. And just as a side note here, Amy, it’s hard to believe, but I just realized as I was kind of preparing for today’s conversation, there’s a whole new generation of church leaders who weren’t in ministry leadership roles the last time we went through a recession, which was about 15 years ago. And so they may be about ready to experience their first recession as a church leader. And if that’s you, here’s the good news. Soon you may be able to say that I’ve led through my first global pandemic and my first global recession. So welcome to the club. I mean, it’s a privilege, isn’t it, Amy?

Amy (15:36):

It’s great news. Yeah. Great news.

Tony (15:38):

But here’s the bottom line. If you haven’t right-sized your staff team to fit the current size of your church, now is the time to do that. And by the way, we know from previous research that stuck churches have 50% more staff than growing, healthy churches. And so does that mean a lean staff necessarily causes church health? I don’t have the data to prove that, but my gut tells me the answer to that is no. So I wouldn’t encourage you just to cut staff with the hope that it will magically help your church get healthy. However, I can tell you confidently that there is obviously something that happens in churches that prioritize maintaining a lean staff, and for whatever reason, that financial discipline, to right-size the staff team, encourages them to hire the right leaders, to engage the right ministry strategies and to develop the right culture that ultimately leads to health and growth in the church.

Amy (16:41):

You know, Tony, when I work with churches, we’re always trying to look at that, like how much can we do? You know, we have kind of a goal, a target, that we wanna get to over the next few years. But my phrase is always progress, not perfection. Progress, not perfection. So we keep taking steps towards where we ultimately wanna be. All right. So the first sign that we need to restructure our staff is that we haven’t rightsized the team or done any work really to right-size the team since the pandemic to reflect the current size of the church. What’s the second sign?

Tony (17:11):

Yeah. The second sign is this, that you haven’t rightsized your staffing budget to create financial margin to fund your church’s mission. So again, this is related to the first sign, but slightly different in that it’s kind of narrowing in on this financial health that churches need to experience. And Amy, as you know, we recommend trying to maintain a staffing budget that’s between 45% and 55% of the overall general ministry budget. And by the way, that staffing budget includes wages. It includes benefits. It includes payroll taxes. It includes staff development expenses. And so on. We take that whole staffing budget and compare that to the amount in the church’s general ministry budget. In other words, that general ministry budget should not include money that you’ve designated for buildings and other significant capital expenditures or things along those lines. And if anything, when you’re looking at that ratio of 45 to 55%, if you can make that staffing investment a lower percentage, that’s probably gonna be helpful in the long run. In other words, trying to even keep a leaner staff so that the staffing budget can be leaner, will free up ministry dollars to eventually lead to strength in the mission that you’re trying to accomplish as a church. But for many churches, they have let their staffing budget creep up to the point that it’s consuming more of the overall budget, especially in recent years. And as more money goes to staffing, churches are eating into their cash reserves, they’re deferring facility maintenance and renovations or they’re reducing ministry budgets. And in some cases it’s a combination of all three of those, just so that they can continue to make payroll. And I’m not speculating on this. I’m hearing from pastors that are making these types of decisions to try to maintain their current staffing numbers and their current staffing budget. And needless to say, that’s not a sustainable model. And again, it’s certainly not the approach to be taking before we head into a possible recession. So we know that churches on average haven’t right sized their staffing budgets based on the data that we collect through our Unstuck Church Report. And this last report was the first time, to my knowledge, that the average percentage churches are spending on their staffing budget was higher than that recommended 55% target that I mentioned a moment ago. In fact, I did dig into the data further, and I confirmed that more than half of the churches who participated in this most recent Unstuck Church Report are spending more than 55% of their budget on staffing expenses.

Amy (20:13):

And that just brings me back, Tony, a little bit to your last point about rightsizing staff, because if we’re already living at the 55%, here are my conversations onsite right now. Hey pastor, we got the bids in for health insurance. It’s going up. And you look at the cost of living, Hey, it jumped 8%. And so they’re having to wrestle with, we need fewer people so we can pay them more because these costs are all impacted. Boy, this is kind of a downer right now of the podcast, Tony.

Tony (20:41):

I know. It is, but it’s all about being as good stewards of the mission God’s called us to, and I really do believe it’s time for churches to right size their staffing budget to create an appropriate financial margin that allows them to fund their church’s mission. I mean, that’s the ultimate goal of today’s conversation. And Amy, I’ve mentioned that we need to right size the number of staff to reflect the current attendance in our churches and that we need to right size the staffing budget to better match our overall ministry expenditures, but can you share how you’re seeing both of these factors impact churches that you are serving in recent months? How is this actually impacting churches on the front line of ministry?

Amy (21:25):

Sure. And I should just give a disclaimer. I’ve heard you do it before. If you think I’m talking about you, I’m not.

Tony (21:30):

I mean, this is just about every church that we’re working with right now. Yeah, that’s right.

Amy (21:34):

It is. Yeah. I have a lot of things going on in my brain right now, but my first comment, Tony, is just that I can confirm what you’re saying is what I am experiencing with the churches that we’re serving right now in our staffing and structure reviews. And it’s often the lead pastor who’s feeling that burden, that the primary burden is the need to right size the team. Current staffing ratios, Tony, they’re ranging from maybe a high of 46:1. In other words, one full-time equivalent for every 46 attenders to a low of below 12:1. And they’re saying things like, I’m also not sure we have the right leaders in place. There’s too much of our staffing dollars that are going towards things like administration. And just a side note, when they want to add higher capacity leaders to their team, they realize their staffing budgets are already too high. So now they can’t figure out how to make financial room for these new leaders that they need. They’re concerned with how they need to staff for the future. We talk a lot about digital reach strategies. You know, they need some new roles, but there’s too much pressure currently because they haven’t done any downsizing or rightsizing. I’ve had one pastor say, man, our staff are busy, but are they busy with the right things? You know, with the additional time on their hands or, you know, the low ratio, some leaders are creating new things to do to fill their time. Because they wanna be productive, but not necessarily on strategic priority initiatives that they’re moving, you know, the mission forward with. I often use the analogy. If you give me a 14 foot U-Haul truck, if I’m moving, I’ll fill it up. If you give me an eight foot one, I’ll also fill that one up with all the same stuff but I just pack it differently. And I think if I had to boil it down, Tony, I think the leaders at the churches were serving are feeling that stewardship burden. Yeah. And if they’re honest, they’re wondering what everyone is doing with their time right now. So many churches, man, they rarely restructure strategically, but I’ve never seen pastors more focused on this topic than they have been right now in this season. Well, Tony, I think you have one more sign that churches need to restructure. So what’s the final sign you want to share today?

Tony (23:38):

Yeah. I’m guessing what I’m about to share will resonate with just about everyone who’s listening to today’s episode. So whereas we started with maybe a couple of downers, this third sign, I think the listening audience is gonna lean in a bit because the third sign is this: You have too many staff to pay your high capacity staff well. And Amy, I think this may be one of the key differences I see when comparing how healthy churches and stuck churches approach staffing strategy. Healthy churches hire fewer staff, and then they pay those staff well. And because of that, they’re very intentional about adjusting compensation, especially in inflationary seasons, like the one that we’re experiencing right now, because they wanna make sure they get high-capacity leaders on their team and then they actually wanna keep those leaders around for a while. And because of that, they tend to make sure compensation is adjusted to keep pace with the cost of living and to reward great leaders for the value that they’re bringing to the ministry team. And by doing so, they’re better positioned to retain those key leaders and prevent them from pursuing other opportunities in organizations that are also looking for high capacity leaders. Stuck churches on the other hand. Well, they just tend to hire more staff and pay everyone a little bit less, some churches quite a bit less. And we’ll get to this more in the upcoming episodes in this series. But these stuck churches tend to hire many more people to do ministry rather than hiring leaders who will empower lay people to engage in the ministry. And this leads to larger staff teams and makes it difficult then to compensate everyone appropriately, especially their best staff leaders. Unfortunately, when this happens, the best staff, then, they tend to find other opportunities inside and outside of ministry that will leverage their gifts and then provide better compensation. And then the church staff, the stuck church, is left with a staff who aren’t as capable and they’re not as experienced in ministry. So here’s where this dichotomy really comes into play. When you have fewer, higher-capacity staff on your team, they tend to have a biased towards developing leaders and building volunteer teams. They have this bias because they know it’s really the only way they’re going to be able to carry out their ministry responsibilities. They have to learn how to give ministry away. And that obviously leads to a leaner staffing model in the long run. And when you hire fewer people, you’re in a better position to pay them well. Stuck churches, though, tend to hire more staff. And when you have more staff, there’s less ministry to go around, for both the staff and for the volunteers. So what ends up happening, we see this time and time again, staff start creating new ministry, new events, new programs to justify their positions. And this is why many stuck churches also become very over-programmed. And if you were to look at their calendar, there are just tons and tons of events that are happening on a regular basis. As the ministry demand continues to grow, the staff in stuck churches tend to have a bias that looks very different. Their bias is always towards hiring more staff rather than engaging more volunteers. And this then leads to larger staff teams in the long run. And when you hire more people, it’s much more challenging to compensate everyone well.

Amy (27:34):

Well, Tony, since we only have high capacity, great leaders listening to our podcast and you’re advocating for them to get a pay increase, that’s probably a great place to conclude today’s conversation. But any final thoughts before we wrap up today’s conversation?

Tony (27:49):

Yeah, whether you reach out to us for help or not, I hope you do take advantage of this unique season of ministry. The pandemic, financial constraints, open positions, and many other factors are creating an opportunity for almost every church to reevaluate their staffing structure. So this is your chance to make sure that you have the right people in the right roles to pursue the right path forward for your ministry. Next week, we’ll continue this series on signs that you need to restructure your staff team by focusing on the structure itself. But until then, let me remind you that we do. We help churches with staffing and structure through our Unstuck Church Consulting Process. This is a key part of helping churches like yours become healthy so that you can grow your kingdom impact. And if you’d like to learn more about that part of our process, you can visit our website at theunstuckgroup.com/staffing.

Sean (28:46):

Well, thanks for joining us on this week’s podcast. In this series, we’re discussing the four signs that you need to restructure your staff. But once you’ve identified the need to change, how do you go about it? Join The Unstuck team on July 28th for a free one-hour webinar on how to restructure your church staff. We’ll reveal the three key steps to restructuring and the tools you’ll need to get there. Register now at the link in your show notes. Next week, we’re back with another brand new episode. So until then, have a great week.

Tony Morgan

Tony is the Founder and Lead Strategist of The Unstuck Group. Started in 2009, The Unstuck Group has served 500 churches throughout the United States and several countries around the world. Previously, Tony served on the senior leadership teams of three rapidly growing churches including NewSpring Church in South Carolina. He has five published books including, The Unstuck Church, and, with Amy Anderson, he hosts The Unstuck Church Podcast which has thousands of listeners each month.

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