^^^et al … Just really never thought about it but of course makes sense.
Endowments, large or otherwise, are often composed of restricted funds with restrictions set by original donors. So even the biggest endowments may not have that big a portion that can be used as a slush fund to cover any fiscal shortfall.
Totally agree but it just doesn’t seem right to me.
Approaching 20% of Harvard’s endowment is unrestricted (https://www.harvard.edu/about-harvard/harvard-glance/endowment). But colleges also measure themselves by the size of their endowment, and have a whole bunch of staff whose raison d’etre is to preserve and increase it. So even the wealthiest colleges are not motivated to spend part of it even in an unprecedented and temporary crisis and some are doing things like laying off low paid staff.
It’s one thing for a college on the edge of financial disaster to have to make cuts, but some of the actions by very wealthy colleges make me wonder whether they have really thought through their responsibilities to all their stakeholders…
@Twoin18 that is what will have to be figured out. It is happening right now and in the summer someone will have to look after the kids when school is not in session. It will also probably come down to where you live. Some areas like rural America will be much luckier in this. But the entire nation will need to be ready that if reopened and those areas that let kids go back if covid starts to pop up they will get shut down quickly. So alternate plans will need to be formulated. This is the reality.
There are other worries with not reopening medical or veterinary colleges in the fall. So many classes are hands on labs that need to be done. I just can’t see paying the tuition we will be paying in the fall for my son to do online veterinary college. I’m hoping they can come up with some way to open these schools at least in some parts of the country. I do think testing needs to be available to make sure students are not positive when they return but that doesn’t mean they will remain negative a week later. I just don’t think colleges can remain closed and stay financially viable for much longer.
this is no big deal. Harvard’s leadership are making hundreds of thousands in salary. And with no/few students on campus, they have no need for thousands of support staff. If they are going to furlough the support staff, they HAVE to take a pay haircut to show that they ‘share’ in the pain. Otherwise, the NYT and Globe would go ballistic.
Just good (and practical) leadership.
Has anyone seen an indication that Harvard is furloughing or laying off support staff? That would be different from what I read in the Crimson article. It looks like what Harvard is doing makes sense-freezing hiring and salaries, considering putting off capital projects, and putting a portion of the salaries of some of Harvard’s leadership into a fund to support employees facing hardship. I agree with @bluebayou that this is good leadership.
Laying off support staff would be a whole 'nothing thing. Many support staff are hourly workers who need a paycheck to support their families.
Staff/wage reductions and cuts in peripheral programs are inevitable for all colleges, even in the absence of the current coronavirus crisis. The level of spending just isn’t sustainable with the trends in demographics, de-globlization, and competitions from online learning platforms. COVID-19 greatly accelerates this process, of course. Some colleges (e.g. those focused on researches in STEM) will adapt better, while some (particularly financially weak LACs) will do much worse.
The initial response by Harvard created a major concern about this issue. They are working through some of these issues now but as far as I can tell they have not fully resolved them (they stated there is payment for 30 days for employees but it is unclear what happens thereafter). Relevant articles include:
https://www.thecrimson.com/article/2020/3/24/coronavirus-lack-comparable-pay/ (raises initial concerns re subcontracted workers)
https://www.thecrimson.com/article/2020/3/19/harvard-coronavirus-huds-custodians-paid-leave/ (discusses initial 30 day solution for employees, but not confirmed for subcontractors)
I expect to see layoffs. They can cut administration salaries, but cutting into financial aid would be visible. Who’s going to notice fewer staff absorbing additional duties?
MIT is introducing hiring and merit increase freezes (two top executives took 20% pay cut), but no immediate layoffs, and also reaffirmed their commitment to finaid:
“Will there be layoffs? Given the terrible state of the current job market, we feel a responsibility to avoid or delay as much as possible cutting costs by cutting jobs. That said, the year ahead may push many units at MIT to reduce or transform their operations, including asking that some staff respond with an openness to changes in their work and roles.
…
We will do everything in our power to keep our community members safe and well, to protect the momentum of our pioneering research enterprise, and to preserve the quality, rigor and integrity of an MIT education. We will keep our commitment to admitting undergraduates regardless of their financial situation and to covering their full demonstrated need – and we are preparing for the likelihood that students may need more help.”
http://news.mit.edu/2020/letter-regarding-institute-financials-0413
Cutting back on financial aid would not necessarily be that visible, especially if it is done only to incoming students (rather than continuing students).
To track cutbacks on financial aid at a college, someone would have to have been tracking financial aid offers, or at least net price calculator results, over the years in order to have data to show that the college is now less generous than before. The college could also reduce financial aid in other ways be using a less generous definition of “need” for some types of financial situations (e.g. self employment, small business, farm, etc.) or by going from custodial parent only to requiring non-custodial parent in divorce situations. All of this can be done to increase net prices paid by students, even if it freezes list price tuition to gain positive headlines.
Another way to increase net prices paid by students is to change admission policies to favor correlates to higher SES, thus reducing the percentage of high-need students.
I wouldn’t be surprised to see some formerly need blind schools considering need for the 2020-21 admissions season. I think it would be hard for schools to renege on FA offers for this fall. I wouldn’t expect anyone needing more than token FA to make it off waiting lists this year.
It will be interesting to see what campus enrollments look like when schools open. Fewer international students and more students asking for deferments, but perhaps balanced by students who would have gone abroad staying on campus.
" If public health officials deem it unsafe for students to congregate, the campus could remain closed until the start of next year."
Which is not going to happen.
Good article in today’s NYT about how the pandemic will impact colleges. Interesting comment from the president of Colby College: "Like other administrators, Mr. Greene is hoping to reopen with classes on campus, rather than online, even if it means deferring the start of the fall semester. “Our whole model of education and all of its power comes from close human interaction,” he said.
But he can only delay so long. “If we had to start in October instead of September, that is not a real problem for us,” he said. “If we had to start in November instead of September, that’s probably not a real problem. What if we started in January and went through August? That would be a very different kind of problem.”"
So, my kiddo just told me that a bunch of students in her O Chem class cheated on their online midterm exam. Apparently the TAs were watching for students posting questions online during the exams. The funny part was that most of the answers were wrong (according to the professor’s email). Somehow they could tell who posted the questions traced back to the students. Those students will have serious consequences.
Perhaps the TAs watching those online locations were the ones who replied with deliberately wrong answers (that students taking the test would otherwise be unlikely to come up with themselves) to see who took those answers and put them on the test.