Colleges Struggle To Prevent Layoffs

The current economic recession has resulted in budget cuts and layoffs at universities across the nation, including some of the nation's most elite institutions. Some universities, particularly the Ivy League schools and those dependent on endowment returns, have been impacted most, creating a climate of budget tightening and unemployment in the upper echelon of academia.

Harvard suffered an especially large hit this year. This September, the university posted a 27 percent loss in its endowment value for the fiscal year 2008-2009, a total of approximately $11 million. With one-third of its operating budget reliant on endowment earnings, Harvard laid off 275 employees this June in response to budget concerns.

Princeton, which shares the title with Harvard as best national university according to U.S. News and World Report rankings, was forced to cut $170 million from its budget due to endowment losses. The university laid off 43 employees and has reduced the hours of 18 others. Princeton had actually anticipated firing more workers, but since 145 employees accepted a buyout, this was not necessary. The university expects these cuts to save $15 million annually.

The problem is not limited to the East Coast, however. Stanford, similarly, has seen a 27 percent decline in its investments and has been forced to fire 412 employees. Stanford is tied with Princeton for third largest endowment in higher education.

At Boston College, such firings have not taken place. In fact, BC hired 49 faculty members last year and is looking to hire 43 this year. The difference between BC's situation and those of other universities seems to lie in the dependence - or lack thereof - on the endowment. Of the entirety of BC's annual operating budget, only 10 percent is derived from endowment earnings.

Management also has an effect. "BC is better-governed and has followed a prudent fiscal course that has enabled the University to weather this financial storm better than many of our competitors, including some of the nation's most elite institutions of higher education," said University Spokesperson Jack Dunn. "BC is an exception because we wrote a Strategic Plan that we announced in 2007 that calls for hiring 100 new faculty members, and we have intentions of continuing with that plan." This plan was written in anticipation of the University's 150-year anniversary in 2013.

This is not to say that BC has not been affected by the recession. Dunn said that the University has continued to explore options for reducing costs and meeting the goals of the University's Strategic Plan.

Although the University has continued hiring faculty members, a soft hiring freeze has taken place for administrative employees and non-faculty positions. The Human Resources Department has been trying to avoid layoffs by cutting costs other ways, such as denying salary increases to employees making more than $75,000 a year.

Robert Lewis, associate vice president of human resources, said there are currently many unfilled non-faculty positions. These empty positions are placed under rigorous review and will only be refilled if the position is deemed vital to the University.

In some ways, this smaller number of employees affects efficiency. "We have to prioritize and be selective about the things we do and don't do," he said. "Many [of our employees] are working harder and longer to get things done." Lewis said he feels that this is a smart way to keep costs down and prevent layoffs.

As a result of the recession, more BC students became eligible for financial aid and those who were previously eligible often qualified for more. Thus, financial aid has become a priority for the Office of Student Services.

In order to deal with the increased amount of need, operating budgets were reduced by 2 percent and the funds funneled directly into financial aid. "This year we were able to meet full need just as we always have despite the fact that there were more needy families," said Louise Lonabocker, executive director of student services.