I'm not Jon, Ben, or Rahul, and I will let them speak to this site, but I found the following question and its answers helpful because it comes from SO and it being the leading site.:
Based on the amount of reputation they need to have, it seems like you'd have to spend a ton of time on Stack Overflow or get lucky on those "answers that keep on giving" to become a moderator (you know what I mean, that one question that gets like 450 upvotes even though it's a really boring simple answer).
How much time do moderators spend on Stack Overflow? I'm surprised they'd have enough time if they also had a full time job. Is being a moderator their primary occupation?
We take up moderation as a voluntary role. That said, on Stack Overflow we're kept in light check:
While being a community moderarator [sic] is a volunteer (but often elected) position, and participation is strictly voluntary at all times, we do require two important things of all elected community moderators.
You must accept the community moderator agreement within 30 days of election or appointment.
On Stack Overflow, due to its immense size and scale, there is another requirement. If you spend time on the site participating but aren’t regularly resolving flags, you may cede your right to remain a community moderator.
We don't get paid for our time at all. And as mentioned, it has little to do with our reputation (although, for obvious reasons, you need at least a fair amount to nominate yourself in the first place so the community knows who you are).
The rest of this answer is largely an individual anecdote; I do not speak for the other Stack Overflow moderators or on behalf of management.
From being elected in November 2011 to last month (~5 months), I was on medical leave and so I had all the time in the world to moderate. In those 5 months I spent virtually all day on the site. I have no regrets.
Now I'm back at school, so I spend considerably less time on the site, whether it's asking/answering questions or doing actual moderation work. I still have a couple of tabs that are open pretty much all day, but I don't refresh or browse them as zealously as before...
In any case, you'll still see me around, and it's not because of reputation or because of any obligation (it's entirely voluntary), but because I enjoy coming here.
No moderator is paid as they are all volunteers. After they set up another bot to grind for Digimons, and sup the tears of destroyed spammers, they start cutting themselves cheques from all the anal bandage royalties in dealing with the trolls and bad seeds of the site.
A moderator's main function is to keep the site jerk free, and the level of commitment and time varies between them. It depends on when they're awake, when the flag beacon whispers dark horrors in their sleep and the usual trawling of the site. It also depends on how active the user base is in self-moderating. The more active the base (closing, user shaping, editing and flagging spam as necessary) the less time you'll see moderators needing to step in to thrown down a bag of oranges.
The correlation between highish EXP and a moderator comes from the drive they have to access more tools to help with the quality control of the vertical. The actions they carry out with the level and privileges they have help other users frame a mindset on what type of user they are and if they're responsible enough to be nominated or even elected.
Of course, there's something of a standard of appearance in the elected moderators. You can't really think a mod is actually moderating if the stoop of crap piles up aplenty as they shovel out posts between it all.
Above all else, their real world employment or obligations come before their time moderating a Stack Exchange site.