When Humanitarians Become the Vulnerable: A Somalia Case Study

In January 2025, an executive order suspended United States foreign assistance for ninety days, followed within the week by blanket stop-work instructions to USAID's implementing partners worldwide.¹ For Somalia — a country in which, according to a rapid survey by the Somali NGO Consortium, more than sixty percent of operating non-governmental organisations named USAID as their single largest donor² — the effect was immediate and structural rather than gradual. Within a week, thousands of humanitarian and development staff across Mogadishu, Puntland, and the regional field offices that make up Somalia's aid architecture received notice that their contracts, and in many cases their salaries, were suspended.³

This essay does not adjudicate the merits of that policy decision, nor catalogue its humanitarian cost, which has been documented in detail elsewhere.⁴ Its purpose is narrower: to use the 2025 shock as a case study through which to build and test a working concept we call humanitarian workforce resilience (HWR) — the capacity of the professionals who deliver humanitarian and development assistance to absorb, adapt to, and recover from disruptions to their own income and career security. A brief note on terminology before proceeding: this essay uses "the sector" to mean the humanitarian and development industry as an institutional field; "the system" to mean the donor-funding architecture that finances it; and "the workforce" or "professionals" to mean the individuals employed within that system. Where the distinction matters analytically, it is made explicit.

The central claim of this essay is structural, not personal: a sector organised around donor concentration, project-based contracts, and internationally benchmarked salaries produces, as a predictable by-product, a workforce with limited buffers against the very shocks it is paid to help others withstand. This is stated once, here, as the essay's organising thesis, and is not re-argued as a defensive aside in each subsequent section. What follows develops that thesis through a proposed definition of HWR, an explicit causal model, and evidence from Somalia's aid-dependent labour market.

01Somalia: A Sector Built on a Concentrated Donor Base

Somalia offers an unusually clear case study in donor concentration risk, precisely because its humanitarian and development architecture has depended so heavily on a small number of institutional funders for so long. Decades of state fragility, recurrent drought, and displacement have made international assistance a structural feature of the economy rather than a temporary bridge, a dynamic that researchers writing on Somalia's post-conflict governance have described as a form of prolonged, multisectoral aid dependence embedded in the country's health, education, and civil-society systems.⁵

USAID's Bureau for Humanitarian Assistance was, within that architecture, a disproportionately large actor. Analysis published in the wake of the 2025 freeze put the value of terminated or suspended Somalia awards at roughly 183 million United States dollars, spanning food security, health, water and sanitation, and governance programming.⁶ A parallel assessment by the humanitarian coordination network ICVA found that a majority of affected Somali organisations placed staff on unpaid leave within the first three months of the freeze, with individual organisations reporting anywhere from a handful to well over a hundred employees affected.⁷

It is worth theorising this concentration rather than simply reporting it. In portfolio terms, an organisation — or a national labour market — that draws the majority of its income from a single source carries undiversified risk in exactly the sense that Harry Markowitz's foundational work on portfolio selection describes for financial assets: risk is a function not only of the size of a position but of its correlation with everything else the portfolio holds.⁸ Somalia's humanitarian financing was not merely large in USAID terms; it was correlated across nearly the entire sector, because so many organisations, and therefore so many households, depended on the same funding line. A donor-concentration ratio — the share of an organisation's, or a sector's, funding attributable to its single largest donor — is a measurable, portfolio-style risk indicator that the sector could adopt directly from financial risk management, and we return to this possibility in the section on measurable indicators below.

This concentration is not unique to Somalia, but it is unusually acute there. Research on localisation commitments under the Grand Bargain — the 2016 agreement in which major donors pledged to channel a greater share of funding directly to local and national responders — has repeatedly flagged Somalia and South Sudan as case studies in how slowly that commitment has translated into practice, leaving local and national organisations disproportionately exposed to shifts in a small number of international funding relationships.⁹ When one of those relationships contracted sharply, the exposure was not evenly distributed across the sector; it fell hardest on the national staff, enumerators, and mid-level technical professionals who made up the bulk of programme delivery capacity.

Somalia's humanitarian financing architecture combined three features that, together, concentrate risk: a small number of institutional donors providing the majority of country-level funding; multi-year but individually short renewable contracts governing the staff who deliver that funding; and salary scales for national professionals benchmarked well above the domestic private and public sectors, which increases both the attractiveness of humanitarian employment and the financial distance a household must fall if that employment ends. None of these features is unusual in isolation — they characterise much of the international humanitarian system — but their combination in a single, fragile, aid-dependent economy meant that a policy decision made in Washington translated, within days, into a labour-market shock affecting tens of thousands of Somali households.

02Toward a Definition: Humanitarian Workforce Resilience

Before proceeding further, it is necessary to define the essay's central construct rather than use it as a plain-language gesture, as earlier drafts of this argument did. Humanitarian workforce resilience (HWR) is defined here as: the capacity of individuals employed within donor-funded humanitarian and development systems to anticipate, absorb, and recover from disruptions to income, employment, and professional standing, without a proportional loss of household welfare or career continuity.

This definition is deliberately built by adaptation, not by borrowing wholesale, from the sustainable livelihoods framework that has underpinned household and community resilience programming since the 1990s, in which resilience is assessed against access to diversified financial, human, social, physical, and natural capital.¹⁰ HWR is related to that framework but not reducible to it, because the humanitarian professional's risk exposure has features a rural household's does not: it is generated by the same institutional system the professional works within, it is correlated across an entire professional peer group rather than idiosyncratic to one household, and it interacts with a distinct form of capital — professional and donor-network capital — that general livelihoods frameworks do not capture. We propose six dimensions along which HWR can be assessed:

• Income diversification — the number and independence of a household's income sources relative to a single donor-funded salary.
• Liquid financial reserves — the number of months of core household expenses coverable from readily accessible savings.
• Transferable human capital — the share of a professional's skill set that retains market value outside donor-funded humanitarian employment specifically.
• Professional network breadth — the degree to which a professional's network and reputational capital extend beyond a single organisation or donor relationship.
• Psychological and identity security — the degree to which a professional's sense of purpose and status is diversified beyond a single professional role.
• Access to portable benefits and protections — severance structures, transition support, and social protection that travel with the individual rather than being tied to a single employer.

Framed this way, HWR is not merely "financial resilience with a humanitarian label." It is a distinct construct because the mechanism generating the risk — donor concentration within a single institutional system — is itself unusual, and because several of its dimensions (network breadth, professional identity) are not standard components of household-level resilience frameworks at all. The remainder of this essay develops each dimension in turn, before proposing, in a later section, how organisations might measure them in practice.

03A Causal Model of Cascading Vulnerability

The relationship between donor concentration and workforce vulnerability is not merely correlational; it operates through an identifiable causal chain, which this essay states explicitly rather than leaving for the reader to reconstruct across sections, as an earlier draft of this analysis did.

This chain is moderated and mediated by several variables developed later in the essay. Mediating variables — mechanisms that help explain why the chain operates as it does — include optimism bias in risk perception and the behavioural tendency toward consumption smoothing described by the permanent income hypothesis, both discussed in the section on salary dependency below. Moderating variables — factors that strengthen or weaken the chain's effect for a given individual — include financial literacy, the depth and financial homogeneity of informal support networks, sector tenure, and the transferability of a professional's specific skill set, discussed in the sections on career dependency and labour market structure.

The model also has a systemic, cascading dimension that a purely individual-level account misses. A donor policy decision does not stop at organisational budgets; it cascades through at least five levels: from the donor, to organisational funding and staffing, to household income, to informal support networks that absorb some of the shock, to the local economy as reduced consumption ripples outward, and finally back to the labour market itself through a feedback loop — visible precarity among current staff affects the risk perception, and therefore the recruitment and retention calculus, of the next generation of entrants to the sector.¹¹ This last effect is rarely discussed in sector literature, but it is arguably the most consequential over the medium term: a workforce that observes its senior colleagues losing income overnight will rationally demand higher risk compensation, shorter-term thinking, or will simply avoid the sector altogether — a dynamic with long-run implications for the humanitarian system's ability to retain experienced national staff.

04The Diagnosticians Become the Patients

There is a structural irony at the centre of this story. For years, the same professionals who experienced the 2025 funding shock had been the authors of assessments, proposals, and evaluations describing, in careful technical language, how vulnerable households cope with shocks: reducing food consumption, liquidating productive assets, borrowing at unfavourable terms, withdrawing children from school, and migrating in search of alternative livelihoods — the operational vocabulary of the sustainable livelihoods framework referenced above.¹⁰

Qualitative accounts collected by sector coordination bodies in the months following the freeze describe professionals adopting informal versions of comparable coping behaviours in their own households: reduced discretionary spending, informal borrowing from relatives, deferred medical care, and in some cases relocation to lower-cost housing.¹² It is important to be precise about the evidentiary status of this claim: it is drawn from qualitative, organisation-level reporting rather than a systematic household survey designed to measure it directly, and it should be read as a well-supported inference rather than a fully quantified finding. A structured survey applying an instrument such as the Coping Strategies Index — designed originally to measure food-insecurity coping behaviour in affected populations — to humanitarian staff households themselves would be the natural next step in testing this claim rigorously, and we return to this as a research recommendation below.¹³

Framed this way, the paradox is a research finding, not an anecdote: workforce resilience has received systematically less measurement and institutional investment than community resilience, despite both existing within the same fragile macroeconomic environment and being exposed to correlated shocks. The asymmetry is visible in an almost administrative sense: humanitarian organisations routinely commission household vulnerability assessments and coping-strategy indices for the populations they serve, using standardised, donor-approved methodologies. It is far rarer for the same organisations to apply comparable instruments to their own workforce. This is not simply an oversight; it falls outside the explicit scope of existing sector HR and staff-care standards. The Core Humanitarian Standard and the People In Aid Code of Good Practice, the two most widely adopted staff-care frameworks in the sector, address duty of care, psychosocial support, and security extensively, but neither specifies a standard indicator for household financial resilience or donor-concentration exposure at the individual level.¹⁴ The tools required to measure workforce resilience already exist within the sector's technical repertoire; they have simply not, as a matter of standard-setting, been turned inward.

05Salary Dependency as a Structural Risk

A useful way to understand why the shock translated so quickly into personal financial strain is through the economics of income expectations. Milton Friedman's permanent income hypothesis, formalised in 1957, argues that households base consumption decisions not on current income but on their estimate of long-run, or "permanent," income, smoothing consumption across time and treating short-term windfalls or shortfalls as transitory.¹⁵ Humanitarian and development salaries, particularly for national staff on internationally funded programmes, are frequently several multiples of the prevailing wage in Somalia's domestic private or public sector. Over a multi-year career of successive donor-funded contracts, it is economically rational — not imprudent — for a professional to begin treating that income as permanent in Friedman's sense, and to calibrate long-horizon commitments accordingly: housing, private school fees, vehicle financing, extended-family support obligations that are a structural feature of Somali social and economic life, and, in some cases, small business investment intended to build a second income stream.

It is analytically important to separate two mechanisms that the previous version of this argument conflated: lifestyle inflation and debt accumulation. Lifestyle inflation describes the calibration of recurring consumption — housing standard, schooling choice, discretionary spending — to an income level assumed to be permanent. Debt accumulation describes the addition of long-horizon financial obligations — mortgages, vehicle loans, business credit — against that same assumed-permanent income. The two compound each other, but they behave differently under shock: consumption can, in principle, be reduced relatively quickly, while debt obligations are typically fixed and cannot be renegotiated on the same timescale, making debt accumulation the more structurally dangerous of the two mechanisms during a sudden income shock.

This asymmetry is compounded by a further behavioural pattern: consumption smoothing is not equally easy in both directions. Prospect theory, developed by Daniel Kahneman and Amos Tversky, demonstrates that losses are experienced as psychologically larger than equivalent gains, and that individuals are systematically reluctant to accept reductions from a reference point they have come to treat as normal.¹⁶ Applied here, this predicts — and qualitative accounts of the 2025 shock are consistent with — a pattern of downward consumption rigidity: households that smoothed consumption upward across several years of stable donor income adjust downward only slowly and with considerable psychological resistance when that income contracts, even when the objective case for immediate adjustment is clear.

This mismatch between income stability and consumption permanence is further compounded by a well-documented cognitive tendency: optimism bias, first formalised by the psychologist Neil Weinstein in 1980, describes the systematic tendency of individuals to rate negative future events as less likely to happen to themselves than to a comparable peer group.¹⁷ Applied to a professional labour market, this predicts that even staff who could recite, from their own project documents, the volatility of donor funding cycles were likely to systematically underestimate the probability that a funding contraction would affect them personally. Read together, the permanent income hypothesis, prospect theory's loss aversion, and optimism bias form a coherent behavioural-economic account of the salary-dependency mechanism: professionals rationally smooth consumption upward against an income they underestimate the fragility of, and then find that psychological loss aversion makes the resulting consumption pattern far harder to unwind than it was to build.

Somalia's specific financial context adds a further layer to this analysis, and its analytical payoff belongs here rather than as an afterthought. The domestic financial system operates predominantly on Islamic finance principles — profit-and-loss-sharing instruments such as murabaha and ijara rather than conventional interest-bearing credit — alongside an extensive mobile-money infrastructure that has become the default mechanism for both formal salary payment and informal borrowing between households. This system is well suited to consumption smoothing at the community level: mobile-money-enabled informal lending between relatives is fast, low-cost, and socially embedded. But it is not a substitute for a formal emergency reserve, precisely because the networks that provide this liquidity during a shock are frequently populated by households experiencing a correlated version of the same shock — colleagues and relatives working in the same donor-dependent sector, exposed to the same funding contraction at the same time. A support network that is itself financially homogeneous provides materially less effective insurance than the sector's informal reliance on it would suggest, a point that recurs when this essay turns to coping mechanisms in the next section but one.

06Beyond Salary: Career, Identity, and Ecosystem Dependency

A salary-only account of dependency, however, is incomplete, and treating it as the whole story understates the risk this essay is describing. Humanitarian professionals depend not only on income but on a donor-funded ecosystem for professional legitimacy, network access, and continued skill relevance — a dependency a salary-only analysis misses. It is useful to distinguish three layers.

The first is financial dependency, addressed above: reliance on a single salary calibrated to a single, donor-contingent income stream. The second is donor-ecosystem dependency: reliance on a specific set of organisational affiliations, donor relationships, and accreditation for professional legitimacy and network access. A professional's CV, reference network, and even technical vocabulary are frequently built around the reporting formats, indicator frameworks, and compliance standards of a small number of major donors; this is itself a form of capital, in the sense developed by Pierre Bourdieu, whose account of social and cultural capital describes how access, legitimacy, and network position function as convertible assets independent of, but frequently correlated with, financial capital.¹⁸ When a donor relationship contracts, this network capital does not disappear, but its liquidity — how readily it converts into new income — drops sharply if the professional's entire network sits inside the same, now-contracting, donor ecosystem.

The third layer is single-labour-market dependency: the degree to which a professional's accumulated skills and experience are legible primarily, or exclusively, within the humanitarian and development sector rather than the broader domestic or international labour market. Guy Standing's analysis of the "precariat" — a class of workers whose employment is structurally insecure despite often-high formal qualifications — offers a useful frame here: Standing's account emphasises status frustration, the psychological and social cost borne by workers whose credentials and self-conception exceed the security their actual labour-market position provides.¹⁹ Somalia-specific evidence for this third layer is discussed further in the section on labour market structure below.

Together, these three layers explain why a funding shock to a single organisation, or even a single donor, can feel disproportionately destabilising relative to its financial magnitude: it simultaneously threatens income, network legitimacy, and professional identity, three distinct forms of capital that had, for many professionals, been allowed to concentrate within the same institutional relationship.

07Comparative Coping: Structural Parallel, Not Equivalence

The vocabulary of coping strategies documented in humanitarian assessments and the vocabulary of coping strategies reportedly adopted by humanitarian professionals themselves overlap closely — a fact that is analytically useful precisely because it points to a shared underlying mechanism. Before presenting that overlap, however, it is necessary to state plainly what the comparison is, and is not, intended to show, because an earlier version of this argument risked implying a rough equivalence of severity that is neither accurate nor intended.

The structural explanation for this typological overlap lies in liquidity, not merely income level. Evidence from the World Bank's evaluation of financial inclusion programming shows that access to emergency funds — the ability to raise a meaningful sum within thirty days without severe hardship — is a function of financial system depth rather than income alone: in upper-middle-income countries, seventy-two percent of adults report being able to access emergency funds, compared with only around forty percent in low-income and lower-middle-income economies.²¹ A relatively high salary does not automatically translate into liquid emergency reserves if consumption has been smoothed upward to match it, a pattern the research organisation CGAP has documented extensively: households with larger cash buffers but comparatively lower discretionary spending are, empirically, more financially secure through a shock than households with high discretionary spending but minimal reserves, regardless of absolute income level.²²

The International Labour Organization's analysis of informal and precarious work reaches a related conclusion from a different angle: workers whose income security depends on a single employment relationship, without portable benefits or diversified income, face materially higher shock exposure than workers with formal, diversified, or portable employment arrangements — a description that, structurally, fits a great deal of donor-funded humanitarian employment more closely than the sector has generally acknowledged.²³

08Psychological and Social Consequences

A resilience framework confined to income and assets underweights a significant part of what the 2025 shock appears to have produced. Stevan Hobfoll's Conservation of Resources theory offers a more precise account than generic job-loss-anxiety literature: Hobfoll argues that psychological stress arises not from any single loss but from the simultaneous, compounding loss of multiple valued resources — income, status, social role, and sense of control — and that this compounding effect is non-additive, meaning the combined loss is experienced as substantially worse than the sum of its individual parts.²⁴ For a professional accustomed to occupying the role of assessor rather than affected party, the funding shock threatened income, professional identity, and — for many — the socially significant role of provider within an extended family structure, simultaneously.

This last dimension deserves specific attention in the Somali context. Within extended-family and clan-based social structures that remain economically significant across Somali society, a household's capacity to provide support to relatives, rather than receive it, carries social status independent of its purely financial value. A sudden reversal — moving from provider to recipient of informal family support — is therefore not merely a financial adjustment but a status transition, with consequences for household and individual standing that a purely income-based resilience measure would not capture. Burnout and professional-identity research in the helping professions similarly finds that identity built substantially around a "helper" role is unusually vulnerable to disruption when that role itself, rather than merely its income, is withdrawn.²⁵

Finally, it is worth distinguishing job loss from the specific stressor of prolonged uncertainty, since many affected Somali staff experienced extended unpaid leave rather than clean contract termination. Research on unemployment and psychological well-being consistently finds that an individual's sense of control over their situation mediates the relationship between job disruption and anxiety or depression; ambiguous, open-ended suspension — neither employed nor formally released — plausibly removes exactly the sense of control that supports adaptive coping, a dynamic distinct from, and potentially more corrosive than, a clean termination that at least permits decisive re-planning.²⁶

09Labour Market Structure: Segmentation, Human Capital, and Mobility

The preceding sections have largely examined the problem from the consumption side of household economics. A full account requires the labour-market side as well: why humanitarian human capital is often sector-specific rather than freely transferable, and what that implies for how quickly, and on what terms, professionals can recover from a funding shock.

Doeringer and Piore's classic account of labour market segmentation distinguishes a "primary" labour market — characterised by higher wages, greater job security, and structured internal advancement — from a "secondary" labour market of lower wages and higher turnover.²⁷ Donor-funded humanitarian employment in Somalia functions, in important respects, as a primary-labour-market segment relative to the domestic economy: internationally benchmarked salaries, structured contracts, and defined technical career tracks. When that segment contracts, affected professionals do not smoothly transition to an equivalent-wage alternative; they typically fall back into a considerably lower-paying secondary segment — domestic private-sector work, informal consulting, or underemployment — a discontinuity that a purely income-focused account of the shock understates.

Gary Becker's distinction between general and firm- or sector-specific human capital sharpens this point further.²⁸ Some skills accumulated over a humanitarian career — data analysis, statistical methods, research design, financial management, facilitation — are genuinely general human capital, retaining value across sectors. Others — familiarity with a specific donor's compliance and reporting formats, institutional knowledge of a particular agency's systems, or a narrow specialisation in donor-specific proposal writing — are closer to sector-specific, or even donor-specific, human capital, with limited portability. The 2025 shock is best understood as having revealed, in real time, which category a given professional's accumulated experience actually belonged to; those with more general, transferable human capital appear to have re-employed or diversified more readily than those whose expertise was narrowly calibrated to a single donor's systems.

Labour mobility out of the sector altogether is further constrained in Somalia's specific context by geographic concentration of alternative formal employment in a small number of urban centres, limited cross-recognition of humanitarian-sector credentials within domestic private-sector hiring, and — for professionals whose careers began directly in the humanitarian sector — genuinely limited prior exposure to non-humanitarian professional networks. These constraints mean that, for many affected professionals, "diversification" is not simply a matter of willingness but of accumulated, sector-specific human capital that takes years to convert into a transferable form — a structural constraint the recommendations below take seriously rather than treating diversification as a simple individual choice.

10Lessons for the Next Generation of Practitioners

These findings point toward practical lessons for professionals entering or building careers within the sector, each of which is tied explicitly here to the mechanism it addresses, rather than presented as generic personal-finance advice.

1. Treat donor funding as inherently transitory, however long a relationship has held. This directly counters the permanent income hypothesis mechanism described above: a multi-year contract history is evidence of a good track record, not evidence of income permanence.
2. Distinguish salary level from financial security, and distinguish lifestyle inflation from debt accumulation specifically. Given their different behaviour under shock (see Section 05), debt reduction should be prioritised over discretionary consumption reduction when building resilience.
3. Build a liquid emergency reserve sized to realistic contract-cycle risk — commonly discussed in personal-finance research as six to twelve months of core living expenses, sized upward in donor-concentrated operating environments — directly addressing the liquidity gap identified in Section 07.²⁹
4. Audit your own donor-concentration ratio, both at the level of your employer and your own client or funding relationships if working independently, applying the same portfolio logic proposed in Section 01.
5. Deliberately invest in general, transferable human capital — data analysis, research design, financial management, facilitation — over narrowly donor-specific systems knowledge, per the human-capital distinction in Section 09.
6. Build a professional network and reputation that extends beyond a single organisation or donor ecosystem, directly addressing the network-capital dependency described in Section 06.
7. Recognise downward consumption rigidity as a real psychological cost, not just a planning failure, and plan gradual, rather than reactive, lifestyle adjustment where possible.
8. Treat career and identity diversification, not only financial diversification, as part of resilience planning — cultivating professional interests, affiliations, or credentials that do not depend entirely on a single professional identity.

None of this implies that humanitarian employment is an unusually poor career choice; it implies that it is a career with a specific, identifiable, and now better-understood risk profile, one that deserves the same deliberate planning the sector already asks communities to apply to their own livelihoods.

11Toward Measurable Indicators of Workforce Resilience

The preceding sections argue that workforce resilience is under-measured relative to community resilience. This section proposes a starting indicator set, corresponding to the six HWR dimensions defined in Section 02, that organisations could plausibly adopt using existing HR and staff-survey infrastructure, without requiring new technical capacity.

None of these indicators requires primary research infrastructure the sector does not already possess; each maps onto data organisations already collect in some form (HR records, staff surveys, grants management systems) but do not currently assemble into a workforce resilience assessment. Piloting such an assessment — even informally, within a single organisation — would meaningfully advance both the empirical basis for the claims made in this essay and organisational practice more broadly.

12Policy Implications — Individual, Organisational, Sector-Wide

If workforce vulnerability is a structural feature of donor-concentrated humanitarian labour markets rather than an individual failing — the thesis stated at the outset of this essay — the appropriate response operates at three distinct levels, organised here explicitly by tier rather than by actor type, so that the intervention logic connects directly back to the causal model in Section 03.

Taken together, these three tiers point toward a single organising principle: organisational and sector-wide resilience frameworks should formally include humanitarian workforce resilience as a named, measured component, alongside the operational, security, and reputational risk categories that are already standard practice in sector risk management.³⁰

13Conclusion

The 2025 funding contraction was, in the first instance, a story about the people the humanitarian sector exists to serve — displaced households, drought-affected communities, and health systems that lost support with little warning. That story remains primary, and nothing in this analysis is intended to displace it.

But contained within that larger disruption was a second, quieter finding: a professional community that had spent decades building the analytical language of resilience for others had not, with the same rigour, applied that language, or the measurement discipline that accompanies it, to itself. This essay has argued that this gap is structural rather than a matter of individual foresight, has proposed a working definition and causal model for humanitarian workforce resilience, and has suggested a first set of indicators by which organisations could begin to close it. For decades, humanitarian professionals have taught the communities they serve that resilience begins before the crisis arrives. The 2025 USAID funding cuts are a reminder that this lesson applies equally to those who deliver humanitarian assistance — and that building that resilience, deliberately, measurably, and in advance, remains unfinished work for the sector as a whole.