Economic Downturn Hits Harvard Hard. (February 19, 2009)

About 1,600 non academic employees of Harvard University, 55 year of age or older, are to be offered voluntary redundancy as a result of the economic downturn.

Harvard's endowment, which stood at US$36.9 billion as of June last year has shrunk 22% and the university is budgeting for a possible reduction of 30% to US$25.8 billion by June this year. Faculty hiring has been frozen and contingencies to limit large large building projects are being drawn up.

Currently Harvard's endowment makes up about 35% of the university’s US$3.5 billion operating budget

The Boston Globe reports: "University President Drew Faust announced today that the university will delay its expansion into Allston in response to the harsh economic reality, and may even pause construction on a massive $1 billion science complex that was slated for completion in 2011.

     "The science complex, touted as the cornerstone of Harvard’s presence in Allston, was to have housed the university’s new department of stem cell and regenerative biology and the Harvard Stem Cell Institute, as well as the Wyss Institute for Biologically Inspired Engineering. Those highly touted projects will now be housed elsewhere, Faust said."

Harvard students will feel the pinch directly as well. The Globe notes that there will be a 3.5% increase in tuition for next year, raising it to US$33,696 (A$52,530) and the total annual cost of a Harvard education – including room and board – to US$48,868 (A$76,170). However, the university will also increase need-based scholarships by 18%.