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Boston Economic Policy Examiner

Harvard’s layoffs and other mysterious budget cuts

June 24, 4:24 PMBoston Economic Policy ExaminerAleksandra Balyanova
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Citing a nearly 30% drop in the value of their endowment, Harvard University has laid off 275 employees, and given many others “deals they couldn’t refuse” - including reduced work hours and early retirement. This move by the university has shocked workers, as a layoff of this scale is unprecedented for Harvard, one of the largest employers in the region. Employees have donated from their own earnings to avoid further layoffs of their coworkers, and many are claiming the high-earners in the upper echelons of the administration should take cuts in their salaries.

Aside from the layoffs, which are an expected reaction to the university’s endowment devaluation, Harvard has undertaken more strange budget cuts. The university’s health services is ceasing to provide anonymous HIV testing; testing will continue to be confidential, but results will appear in student’s medical records. The university will also be closing its Office of Sexual Assault, Prevention, and Response for the month of July. A conservative blog, "A Silver Lining at Harvard", celebrates these decisions, claiming they represent the university standing up to political correctness. If there is one thing this demonstrates, it is that even the proponents of these budget cuts see a pattern that goes beyond shutting down inefficient, expensive institutions - there appears to be a slightly ideological component.

Unfortunately, whatever one’s views about political correctness may be, Harvard should be concerned with budget cuts that fall within an ideological pattern. Universities with large endowments like Harvard depend heavily on alumni donations, and alumni donations depend on the university’s reputation. To make changes like this, which reflect a contradiction of the liberal, progressive attitudes the university is known for, may decrease Harvard’s expenditures in the short run. In the long run, however, Harvard should be careful about what effects ideological budget cuts can have on their reputation, and what that change in their reputation can entail for alumni donations and the value of their endowment.

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