Wednesday, 22 October 2014

Five things I'd like to say about calculating the economic value of volunteering

Since incorporating Volunteering England into their work, NCVO have started producing some good blogs on volunteering. These are mainly written by their Executive Director of Volunteering & Development, Justin Davis Smith (former Volunteering England CEO) but good material from other authors appears too.

Just a few weeks ago a new blog post appeared entitled "Five things you need to know about calculating the economic value of volunteering". This post summarised a paper from Jakub Dostál and Marek Vyskočil of Masaryk University’s Department of public economy and administration which won the prize for best paper in the New Researcher’s Session at the Voluntary Sector and Volunteering Research Conference 2014.

In the post there are five tips for "confronting economic calculations in your work or in someone else’s". As I read the article I started to feel downhearted yet again at the lack of awareness of the dangers of perpetuating the myth of economic value of volunteering and the absence of vision or ambition to do any better.

I'm not going to attempt a full analysis of the pitfalls of attributing notional wage 'values' to the work of volunteers. My American colleague Jayne Cravens has written an excellent commentary on the problems of valuing volunteers in economic terms. I've also written an analysis of the well intentioned by flawed efforts by the International Labor (sic) Organisation (ILO) to capture economic measures of volunteering globally in their Manual on the Measurement of Volunteer Work. If you are interested in exploring this topic in more depth then both those sources are good starting points.

What I do want to do is provide five responses to the five things the NCVO blog (author unknown) tells us we need to know about measuring the economic value of volunteering.

1 - Remember it's an estimate
Yes it is, but everyone from the ILO down seems so wedded to it that almost no energy is being invested in coming up with something better. Economic value is measured because it's easy, not because it's the best thing to measure. That speaks volumes about the actual value placed on the contribution of volunteer to society when so little effort is willing to be spent trying to get more accurate.

2 - Estimates rely significantly on the type of replacement wage
I absolutely agree with the author here. They flag up why economic measures of volunteering are not only an estimate but a poor one at that. The ILO manual does try to standardise this but in practice that's an approach that is far more complex and involved than people are usually willing to be. Remember, this is an area where we can't even be bothered to develop a decent measure, just the easiest estimate.

3 - There are still good reasons for using the concept of replacement wages
No there aren't!

First of all, economic measures focus on wage replacement methodologies (i.e. attributing a notional wage value to the work done by volunteers) don't actually measure an output or on outcome. Rather, they attribute a financial amount to an input, namely the time that volunteers give. In my view they therefore fail to calculate any kind of meaningful value to the work of volunteers. Rather they ascribe an economic amount to something we'd never pay for anyway. Even if we did accept that there was some kind of value in these measures, it is calculated on the same terms as paid work, from which we know volunteering is distinctive.

In an age where demonstrating actual value - the contribution made to society, the difference made by giving time - is increasingly critical, whether in effectively recognising volunteers for the work they do or for securing income from funders, we have got to get better at evidencing this for volunteering. Replacement wage calculations do not do this and need replacing with something much better.

Second, the author argues that we should use economic measures because there are existing "statistical systems and surveys". That's following the same line of reasoning as before - we'll measure it because it's easy not because it's the right thing to do. They try to justify this by saying that in the absence of any other methodologies we should go with what we've got lest we end up with something of lower quality, done without academic support.

Frankly, this is someone saying, "Look, this is what we are prepared to measure. If you don't like it then we think you couldn't possibly come up with something yourselves and because academics wouldn't be involved if you did it wouldn't be any good".

4 - Ask for more: don’t forget future research
Here, the article's author accepts that there may be a better measure out there and that we should always ask for more. In fact, they say the academic world should ask for more but given the attitudes we've seen thus far I'd argue that it is the volunteering movement that should ask for more. For more interest in this topic by academics. For more vision and ambition that just settling for what's easy to measure. For more respect for the intelligence of leaders and managers of volunteers rather than assuming superiority over us.

They also argue that what we have now is better than we've had in the past. I'd make two observations here.

First, what we have now is not that different than we had 15-20 years ago. Progress on measuring the true value of volunteering is glacial. We may well ask for more but if we carry on as we are we're looking at decades passing before we get anything better.

Second, is what we have now actually better than not having economic measures for volunteering? Do statements like "Volunteers are worth £500m to the NHS" help? Do they instead suggest to ill-informed decision makers that they could cut budgets and get volunteers in for free instead? Big Society anyone? I'm sure many could do without these problems which we encounter because flawed economic measures of volunteering are so common.

5 - Not everything that counts can be counted
Here, the author acknowledges that other methods of calculating true value such as SROI exist. Again though, they state that these, "measure the social impact of volunteering, but it is extremely difficult to cover all the many types of benefits". So they conclude their article with an admission that its hard, so we'll stick what what we've got. Easy is better than meaningful. Again! Sigh.

What do you think?

Are there better ways to measure the value of the contribution volunteers make to society? What are they and how do they work?

What's been your experience (good and bad) of using economic measures of volunteering?

Is there anything else you'd like to say?

1 comment:

  1. One of the challenges around any sort of valuation of volunteer effort is that there is more than one reason to place a valuation on volunteer effort, and with each one of those comes a different approach that best addresses that particular reason.

    Consider the three following examples.
    1. Peak bodies (and hopefully governments) are interested in how the overall quality of life is improved in a community (city, state or country) through the engagement of volunteers throughout the community. This would rightly include not only some value on what the volunteers accomplished, but also the long-term spinoff effects (outcomes) of their accomplishments, and the enrichment of their own lives through volunteering.
    2. An individual organisation that strives to direct all of its efforts toward accomplishing their mission as efficiently and effectively as possible needs to measure the difference between the value of what gets accomplished and the cost (in cash spent and opportunity cost of the volunteer’s time) of accomplishing it.
    3. A donor to an organisation might be interested in the overall value of the cash donations and noncash donations of time to the organisation to gain a sense that his/her donation will be part of a much greater pool of giving. Here, although still in my mind something to be treated as a cost (an input rather than an output), a wage replacement value might have some merit.

    It seems to me that it would be helpful if the phrase “value of volunteering” were no longer used as generically as it currently is so that the methodologies suited for a particular purpose could be identified and then applied only for that particular purpose.