Universities Making Sweeping Budget Cuts Amid Pandemic Losses
There was no secret that the college experience was going to be fundamentally different in 2020, due to the ongoing outbreak of the Coronavirus.
Virtual classes, social distances and COVID testing all became common realities that students have been living with since the start of the Fall semester. But the changes aren’t stopping there with most universities.
These schools are losing money on enrollment, housing, dining, sporting events and various other outlets that generate revenue.
Because of these losses, colleges are being forced to slash their budgets to offset their losses according to a report from the New York Times. The article begins by highlighted some of the drastic adjustments universities are making around the country.
“Ohio Wesleyan University is eliminating 18 majors. The University of Florida’s trustees this month took the first steps toward letting the school furlough faculty. The University of California, Berkeley, has paused admissions to its Ph.D. programs in anthropology, sociology and art history.”
While many hoped that COVID-19 would be under control by this time in the year, the case total in the United States continues to climb. With each passing day, schools are having to make more difficult decisions, as the previous economy that colleges thrived in has escaped them.
No one knows when things will get back to normal, so action is required to cut off some of the great losses that these schools are enduring. According to the New York Times, losses are skyrocketing for colleges.
“By one estimate, the pandemic has cost colleges at least $120 billion, with even Harvard University, despite its $41.9 billion endowment, reporting a $10 million deficit that has prompted belt tightening.”
Colleges attempted to get ahead of these types of cuts last spring, taking measures such as early retirements and limiting hires, but now they are still at a point where layoffs are becoming likely.
What has exacerbated the financial woes for universities is the extra costs that have been created by the Coronavirus. Colleges have had to spend a great amount of money on COVID testing, to be able to properly protect the health and safety of their student body.
Other operation costs when it comes to promoting social distancing and sanitization have added to the burden these institutions have faced to keep their doors open.
Students still value their education and the college experience they expect to have while attaining their degrees. Yet all of these aspects of being a student are changing due to the pandemic, with no clear timeline for when things will return to the way they once were.
In the end, universities are going to do whatever it takes to continue to stay afloat, but the economics and business behind colleges has never been more apparent. These schools are expected to make money. If they have to continue to cut out degrees and lay off staff to do so, that will be the path they chose.