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Volume 83 | Issue 2
March 2015

Paying Students for What Matters

Aimee Shattuck

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shattuck core competencyOne of the greatest joys of any student affairs professional is when a student reaches out years after graduation to say thank you. Four years after graduating, a young man who had actively challenged administrators as a student leader wrote to his past advisors: “Reflecting on where I am and how my experience at [Portland State University] got me here, I can solidly say that my time in Student Activities and Leadership Programs was a cornerstone of my success.” The alumnus went on to discuss the skills and experiences he gained as a student that helped him to become a community leader.

Student learning has always been the driving purpose of college unions and student activities. At the turn of the 21st century, student activities departments began to focus on leadership development, aiming to teach students values and skills to positively affect their communities. During this same period, tuition and fees grew more rapidly than family income, and many students struggled to afford college. Financial compensation emerged on campuses as a way to motivate students’ involvement in leadership as well as to reduce financial barriers to engagement—a practice that is still common today.

Economists, sociologists, and psychologists have relevant theories and research on how people are influenced by pay. In his book Predictably Irrational: The Hidden Forces that Shape our Decisions, Dan Ariely explained the difference between social norms and market norms. Social norms include friendly requests of time, resources, or favors in which action provides pleasure for both people and reciprocity is not immediately required. Market norms are exchanges of time and resources anticipating prompt payback: wages, prices, rents, interests, and costs-benefits. “When you are in the domain of market norms, you get what you pay for—that’s just the way it is. …Money, as it turns out, is often the most expensive way to motivate people. Social norms are not only cheaper but often more effective as well,” Ariely explained.

Compensating students for their leadership roles on campus may be essential, especially on campuses where students struggle to make ends meet. However, doing so comes with other challenges, including navigation of policy and law as well as underwhelming student motivation and behavior. To overcome these challenges, student activities professionals can be creative and open to various types of compensation and use social psychology theory in an effort to pay students for what matters. 


Many activities professionals see compensation as a way to incentivize involvement and reduce financial barriers to participation. Financial compensation may be in the form of stipends, tuition remission, hourly pay, or other rewards such as book vouchers. Depending on how a student is compensated, complex issues surrounding labor and tax laws may arise. For example, students paid hourly may be subject to state and federal tax laws that require them to track hours and have a staff supervisor. Students paid a stipend or certain types of scholarships may have to pay taxes or have their financial aid affected. It is important to work closely with legal counsel, financial aid, and human resources to understand these issues when choosing a method of financial compensation.

Furthermore, compensation may lead to unintended behavioral reactions among students. Most definitions of leadership incorporate a social aspect. Washington State University–Vancouver defines leadership as “students who go above and beyond to help other people.” Implied in that definition is the social norm of service. Student affairs practitioners want students to “be motivated and to be here for the right reason, not for the money,” said Michelle McIlvoy, director of student development. However, when incentives are introduced in the form of money, market norms apply.

Student affairs practitioners may be surprised that if some financial compensation is offered up front, students may expect more or start feeling undervalued if they do not perceive the pay is enough. Kristin Muncy, associated director of student activities and involvement at James Madison University in Virginia, explained that in the past, financial compensation was a larger focus for the university’s leadership program. However, once it changed to a scholarship, the money was no longer the reason people got involved. The compensation is now “just not a focus at all. I like that,” Muncy said.

Furthermore, reasons for getting involved may affect motivation and commitment. Emily Romito, director of the first-year experience and student activities at the University of Pikeville in Kentucky, said she notices a difference in students who are placed in her office through the work-study program versus students who independently pursued the position. Those who are placed might be “doing it for the money” whereas students who seek it out are “getting paid to do something they would be doing anyway,” she said.

Leadership educators want students to lead and participate because it is the right thing to do—to have what social scientists call intrinsic task interest, or motivation that comes from within rather than a quid pro quo reward. Although definitions of leadership are rooted in social norms and the common good, campuses often offer money to entice students to take or keep leadership roles. When using this dual messaging, which includes both social and market incentives, most hope the social norms outweigh the market norms. However, Ariely’s research revealed that “people are willing to work for free, and they are willing to work for a reasonable wage; but offer them just a small payment, and they will walk away.” In other words, students who are not paid at all would serve (although there may not be many who could afford it), but students who seek positions for the pay will work at the level they feel is equivalent to the financial reward.  

Despite good intentions—encouraging students to be leaders for all the right reasons while reducing financial barriers—this practice may be creating unintended behaviors or expectations. Clearly, not all paid students are only motivated by the money nor are all volunteers fully committed. However, student activities professionals need to be cognizant of how they formulate reward structures. By applying research on motivation, they can develop programs that foster engagement and learning while encouraging and maintaining student involvement.

shattuck case study graphsCase Study

Before 1995, a small number of student government leaders at Portland State were paid hourly. The hourly model posed a number of problems for students and administrators: It made the student body president an employee of the university, creating an interesting dynamic when she wanted to advocate against the people who were then considered her “bosses.” It also required the students to track and be paid by the hour. Doing so was difficult, as student leadership involves inconsistent scheduling—some weeks working many hours and some weeks only a few. With labor and wage laws, students were either forced to act like shift employees, coming and leaving at designated times, or lie on their time cards to stay within budget. Many administrators feared that the latter was happening more often than not.

In 1995, the student activities office moved to a stipend model, still processed through human resources but as a lump sum per month rather than as hourly wages. As time passed and this system seemed to work, students and administrators wondered if the structure would be a solution for other organizations. There was a general worry on campus that not enough students were taking advantage of leadership opportunities. Activities staff believed the system discouraged the least advantaged students from participation. Then, as now, Portland State had a mostly nontraditional student population; most students had to work off campus, and their financial concerns often prevented them from succeeding in academics and cocurricular involvement. Perhaps by paying student leaders, not just in student government but for student organizations as well, Portland State could provide access to leadership opportunities for low-income students. Additionally, many reasoned, why was student government work any more important or educational than being the student leader of a well-established club?

The student affairs practitioners started with the intention of paying students so that they could invest their time in an educationally purposeful pursuit rather than getting an off-campus job. This created an unanticipated perception and attitude among other student leaders: “If they get paid, I should too.” And so, students righteously lobbied their funding body for more money, and more students were paid. From 1998 to 2006, the financial impact of student leader compensation increased from $24,000 to $441,000—entirely funded through student fees.

As this logic continued, the amount of awards grew nearly exponentially during the eight years, and some natural balancing mechanisms came into play. As Peter Senge wrote in The Fifth Discipline Fieldbook, “A reinforcing loop, by definition, is incomplete. You never have a vicious or virtuous cycle by itself. Somewhere, sometime, it will run up against at least one balancing mechanism that limits it. The limit may not appear in our lifetime, but you can assume it will appear. Most of the time, there are multiple limits.” In the case of paying students stipends for their leadership, ultimately the balancing mechanisms were administrative breakdown, labor law, and financial resources.

One of the issues with the stipend model was regarding the assumptions made about why more students were not involved in student leadership. Because Portland State students are older, have more life responsibilities, and have more financial instability than students on campuses known for higher levels of student engagement, the assumption was that these factors were keeping students from participating. This makes sense and is often repeated by the students. However, a number of other factors reducing students’ motivation to be involved were largely ignored: the number and types of student leadership opportunities were inadequate; first-generation students often did not see the connection to their passions and experiences; and many students simply did not know the opportunities were available. Furthermore, feedback loops needed to be strengthened. For instance, involved students and staff needed to recruit and support emerging student leaders who could then recruit and support more students.

Students and administrators focused on financial constraints as the primary barrier to student engagement, which became the accepted truth, yet this perceived obstacle was never fully examined. What was actually happening in student organizations painted a more complex picture. The goal of most administrators was to reduce financial barriers for underrepresented groups (including low-income students and students of color). In 2009, 42% of the student organizations were organized around cultural affiliation and included some of the largest groups by membership and budget, receiving 44% of the total funds allocated to student organizations. What happened to those monies, specifically stipends, was interesting. Many of the multicultural groups were choosing to pool their stipend budget and divide it among a large leadership team. Some groups wanted to give less than $20 a month per student, completely counter to what the administrators envisioned as reducing financial stress. For the most part, student organizations were able to decide how much to give to each position within some loose parameters. In 2009, 126 students earned stipends for their work in student organizations (not including student government), and 82% earned less than $300 per month. Only 12 people earned stipends over $400 per month.

Portland State had based the model on one root cause (financial), but what if that wasn’t the only root cause? What if focusing primarily on one motivator—money—was actually drastically reducing other powerful motivations?

By putting so much focus on financial motivations, the paradigm of student leadership shifted from service (social norms) to employment (market norms). Students—especially those paid more than $300 a month—would often say they were underpaid and didn’t want to do the work. Many student government officers advocated for senators to be paid because “it wasn’t fair to do the work for free.” It is important to keep in perspective that hundreds of students involved in leadership were not paid and that many who were paid were voluntarily sharing the funds among a group rather than among one or two individuals. If hundreds of students were motivated enough to be involved without being paid to do so, what was the incentive?

Social norms were the answer. Many students reported that they originally became involved with student organizations to meet people, form a community, or to create positive change on campus. Students were consistently asking for more opportunities to build meaningful relationships and collaborations and for more leadership development programming. Most programming for student leaders was about how to navigate policy and paperwork and not about how to be a better, more knowledgeable person or leader. In February 2009, an exasperated student government created a student task force to write a series of demands. This long list included assertions that “current leadership development efforts are ineffective and insufficient” and that the “bulk of advisor workload is administrative in nature.” Although students and administrators had different ideas about causes and solutions, they did agree with nearly all the
stated problems. 

This indicated a balancing mechanism (or what more accurately felt like a system on the verge of a meltdown) and prompted change. From 2010-12, the student activities department completely restructured student leadership incentives to highlight social rather than market norms. Rather than groups being able to budget for their own stipends, the model was changed to fund scholarships for up to 100 student leaders at $300 per term. Based on the financial aid office’s scholarship process, the fund would be administered through an award system instead of payroll, satisfying both the human resources department and the university attorney. For student leaders to access the award, they had to apply to be a leadership fellow and write a statement about their goals and interests. Students had to hold a leadership role to qualify for the program, but they would no longer automatically be compensated upon being hired or elected. Students accepted into the program were placed into cohorts of 10–25 in which they worked with students from all different groups and interest areas and met three times a term for leadership development discussions and facilitated activities. The emphasis in recruiting students to the Leadership Fellows Program has been primarily focused on the social benefits: growing as a leader, meeting other students, forming community, expanding experiences, and gaining knowledge. The market incentives (financial award and class credit) were still considered important but were not emphasized.

In reframing the issue, Portland State not only changed how students were paid; it changed the entire incentive and motivation landscape. Since 2000, multiple attempts had been made to curb the spiraling stipend model, but all focused on administrative symptoms (creating new spreadsheets or processes), the financial impact (creating stipend caps or ranges), or changing the perception of students (trying to convince them they aren’t employees while sending them to payroll). All of the fixes had felt monumental, but actually proved to be short-term. In her book Thinking in Systems: A Primer, Donnella Meadows called this a bounded rationality: “Instead of finding long-term optimum, we discover within our limited purview a choice we can live with for now, and we stick to it, changing our behavior only when forced to.”

Portland State is now midway through the fourth year of Leadership Fellows. Currently 166 students are participating with different scholarship levels for various degrees of responsibility. Everyone who is compensated as a student leader in student government, student media, the programming board, service learning, or student clubs must successfully pass each term to earn their scholarship. Although it took a couple of years for students to buy into the program, it is now more widely respected, and students are enthusiastic about being involved. The conversation has moved toward creating a sense of community and away from fighting about money.


Financial rewards can be a sound way to encourage student involvement. However, they should be tied to the most important behavioral outcomes. In his book Drive: The Surprising Truth about What Motivates Us, Daniel Pink wrote about how financial “if-then” compensation can help keep people motivated in routine, formulaic work but will sap motivation for anything that requires creativity or autonomy.

First, student activities professionals can determine which behaviors need to be rewarded based on the position: Time on task? Productivity? Reflection and learning? If it is time on task in a routinized position, consider hourly pay. As Pink wrote: “For routine tasks, which aren’t very interesting and don’t demand much creative thinking, rewards can provide a small motivational booster shot without the harmful side effects … because there is no intrinsic motivation to be undermined.” Conversely, if a position requires autonomy and creativity, it is best to disassociate financial compensation from the role.
The Portland State model seems to work because students are not automatically compensated for their position. The pay is connected to completing a fellows program for which they must have a leadership position to qualify. The focus of that program is not learning information or specific skills but creative problem solving and reflection. Students are given autonomy in their actual positions to be creative and flexible without carrots or sticks. This may seem like an insignificant nuance, but it is psychologically significant.

Second, understand both the needs of the student population and the campus’ interpretation of policies and laws. Be creative, and then check with legal counsel, human resources, financial aid, and others about what is possible. For example, if international students participate, restrictions may exist on how many hours they can work or types of aid they can receive. Stipends or scholarships may affect students’ financial aid awards. The campus may need a way to take taxes out of awards without going though the personnel system, or payments may not be able to be processed in certain ways. And, make sure that if the program grows, it will not be administratively burdensome for the activities department or colleagues in other areas.

Third, think about how opportunities are framed in outreach and recruitment to current students. If the department chooses to focus outreach on how much the student will be compensated, that might become the students’ priority in seeking the opportunity. Alexandra Froehlich, assistant director of student leadership and development at Loyola Marymount University–Los Angeles, does not see pay affecting motivation within student government because “members often don’t realize they are paid until they get the check.” This heeds Pink’s warning that: “Holding out a prize at the beginning—and offering it as a contingency—will inevitably focus people’s attention on obtaining the reward rather than attacking the problem.” Involvement opportunities can be framed in social norm terms such as service, community, networking, and belonging.

Research and experience tell us that students participating as leaders on campus benefit personally from their engagement. However, many campuses struggle with encouraging and maintaining student investment at a level perceived as high or deep enough. This challenge is especially keen at institutions in which students may have many competing responsibilities, such as work, children, or elderly parents. Financially compensating student leaders can be a rewarding and viable solution; however, the means chosen should be informed by policy and law as well as theory and research. As a program creates systems that foster learning and reflection, an added benefit emerges: motivated student affairs professionals who see purpose and results from their work.


aimee shattuck mugshotAimee Shattuck is the director of student activities and leadership programs at Portland State University. She has a master’s degree in social work and finds human behavior and systems fascinating.