Harvard Cuts Employees as Economy Impacts Endowment
June 24, 2009
Patricia Marroquin--HispanicBusiness.com
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Harvard University announced Tuesday that it's eliminating 275 jobs, citing huge losses in its endowment because of the financial crisis, according to Reuters.
The move by the world's richest university reportedly came as a result of an estimated 30 percent drop in its multibillion-dollar endowment for the 2009 fiscal year ending June 30.
In an e-mail to faculty and staff, Marilyn Hausammann, vice president for human resources, said the cuts primarily are in administrative, clerical and technical positions and will occur beginning this week, Reuters reported.
Forty additional staff members will have reduced work hours at the Cambridge, Mass., university.
Less than 2 percent of the Ivy League school's 16,000 faculty and staff members are affected by the layoffs, but they're a sign of the recession's toll on institutions that depend on donations and endowments.
Harvard's endowment dropped 22 percent at the end of 2008 to $28.7 billion and is projected to be $25 billion by the end of June, according to published reports. The endowment financed about one-third of the university's operating budget for 2008, Reuters reported.
Other cost-cutting measures Harvard has taken include keeping salaries flat for more than 9,000 staff and faculty members for the 2009-10 academic year, and a 30-day external hiring freeze for staff jobs. In addition, more than 500 staff members are taking voluntary early retirement through a program offered earlier this year.
U.S. institutions of higher learning on average lost nearly a quarter of their endowments in the second half of 2008, according to a poll by Commonfund Institute, Reuters reported.
Source: HispanicBusiness.com (c) 2009. All rights reserved.
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