A salary and economic outlook study conducted through Leadership Network with Church Executive involving 56 very large churches--mostly evangelical megachurches--reveals that 44% of them are facing capital expansion issues in the coming months. And that capital campaign trend doesn't look to change anytime soon.

When asked, "Is your church planning any of the following emphases in 2007?" the first-ranked choice among the six options (almost double the second-ranked choice) is "a capital funds drive for new property or building."

"In an age when multiple services, multiple venues, and even multiple campuses are widely utilized, churches still find themselves investing heavily in bricks, mortar and technology equipment," says Warren Bird, Director of Research at Leadership Network, and primary writer of the report. "Newer churches eventually build a permanent facility or they often extensively adapt their rental facilities," Bird continues. "Older churches face continual maintenance and updating needs. Growing churches--new or old--must constantly expand to accommodate more people, and all churches at some point develop new ministries that require major capital investments." The capital campaign is not always for the direct benefit of the church raising the money. According to the survey, 23% of responses indicate that during 2007 they will be making "an appeal to plant multiple new congregations," and 14% said that during 2007 they will be making "a gift to mission causes close to or more than $1 million." Both initiatives bring financial implications with them. Among the other 2007 plans of the surveyed churches, 19% will be making "an appeal to launch a new worship site" of their own congregation, 14% "a debt retirement funds drive" and 9% "a large appeal for any denominational cause of any type."

Surveyed churches use 14% of their budget for ministry beyond the congregation.

Salary Range Another noteworthy topic in the survey results involves the salary range of the senior staff. The survey asks about cash salary plus housing allowance for various roles, separate from other benefits that are often a sizeable part of a pastor's compensation plan. Among the findings: The typical large-church senior pastor has four direct reports, in priority order: executive pastor/director, associate pastor/minister, business administrator/operations director and worship pastor. The average salary for 2006 for senior pastors is $131,702, up slightly from $130,004 a year ago; the highest salary of sampled churches was $364,000, though the second-highest was considerably lower: $240,000. "This decrease might be due to the decreased responsibilities of the executive pastor in many churches," Bird says. "However, one limitation of not having a true random sample is that we cannot be certain of the significance of every figure, which is something Leadership Network would like to explore for next year's report."

Staff-to-Attendee Ratios
Perhaps the most unexpected finding of the report, according to Bird, was that on average, the sampled churches have one full-time staff member for every 59 attendees. Leadership Network conducted a salary survey in 2001, 2003, 2005 and now 2006, but it had not before included this question about the ratio of staff to church size.

"Predictably the ratio would be higher if the question were limited to the number of pastoral and ministry staff," Bird says. Part-time staff were combined to create a full-time staff equivalent. The ratio includes everyone from salaried janitors to salaried pastors, but does not include school staff for churches that sponsor a school.

Most surprising was the broad range of responses to the staffing question, Bird says. One church of 1,500 attendees has one staff person for every 18 church members, while another church of the same size has a 1:125 ratio. Among churches with an attendance of 3,000-4,999, the range was 1:22 to 1:119. Among the 5,000-8,000 attendance range, the ratio is 1:40 (church of 6,000) to 1:116 (church of 5,675).

"People often think that the bigger the church, the smaller the amount of staff needed, proportionally speaking," Bird says. "For many churches, that's true, but others grow more top heavy with increased size. The primary variable is probably how much emphasis the church places on making leaders: empowering and releasing the people of the church to do ministry."

Attendance and Offerings Elsewhere in the report, most surveyed churches have seen increases in attendance and financial offerings for the first eight months of 2006. Worship attendance year-to-date also is up 52% among all respondents. The researchers make no claims for the statistical accuracy of the survey as representing all larger churches, nor is it based on a random selection. The surveyed churches volunteered to participate after receiving an invitation from Leadership Network and from an e-mailing by Church Executive magazine, which supported the survey process.

But researchers hope that the data indicates many general trends and provides a basis for churches in their planning and administration. For example, a ranked chart of benefits indicates that medical and dental insurance benefits accrue to most full-time staff. Only 8% receive a paid health club membership, 20% have a ministry or sabbatical leave and 47% have paid cell phone service. Many churches note that the pastoral and ministry staff receive more benefits than other staff.

Staff costs (salaries plus benefits) average 51% of the total church budget. Responses offered a wide variation, from less than 35% in some churches to more than 65% in others.

Economic Outlook In the economic outlook section, one sign of optimism among the 56 participating churches was their positive response to the statement, "Our church will probably meet its budget this year." A whopping 94% answered yes, 4% did not respond, and 2% were unsure. A similarly high response--94%--expect to experience an increase in church income in the coming year. In spending plans for next year, "facilities spending" tops the list, when combining the responses of "slight increase," "moderate increase," and "significant increase" in expected spending (from a total of seven possible responses). Next in order of anticipated expense increases are staff salaries, information technology, missions giving, in-house publications and marketing and program-related spending of all types. At bottom was staff continuing education. Average salary pay increases for the next budget year are 3.5%, with little significant change based on church size.

Among the 56 responses used in the report, the average attendance is 3,181, with the range between 1,500 and 8,000. Average budget (all funds combined) for the entire group is $5.6 million, which is slightly higher than the budget average of the 2005 survey respondents.

For a complimentary copy of the full "2006 Leadership Network Salary and Economic Outlook Report" including graphics (or similar reports from previous years), go to www.leadnet.org, and enter keyword SALARY.

Ron Keener is managing editor of Church Executive magazine, Phoenix, AZ. To subscribe go to www.churchexecutive.com and select the "subscribe" button. This article also appears in the November 2006 issue of Church Executive.