Stanford layoffs: University fires more than 360 employees; blames Trump's federal funding policies

Time of India

4 days ago

Donald Trump (AP) Stanford University (visit.stanford.edu)
Stanford University announced on Tuesday that it has laid off more than 360 employees, citing budget pressures linked to federal funding policies under the Trump administration.
"Stanford is in the process of making budget reductions," a University spokesperson stated in an email, reported Reuters. "Last week, many schools and units made staff workforce reductions. In total, 363 layoffs occurred."
The university pointed to recent threats by the Trump administration to withhold federal funds from institutions over a range of issues, including pro-Palestinian campus protests against Israel's actions in Gaza, climate initiatives, transgender rights, and diversity, equity, and inclusion (DEI) programs, reported Reuters.
University leaders stated that they "face significant budget consequences from federal policy changes and those changes will cost Stanford $140 million,' reported ABC7 News.
"...The university is making a $140 million reduction in the general funds budget for the upcoming year. This is the product of a challenging fiscal environment shaped in large part by federal policy changes affecting higher education...these are difficult actions that affect valued colleagues and friends who have made important contributions to Stanford,' stated a letter by Stanford's president and provost to the faculty and staff last Thursday.
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A spending bill backed by Trump and passed by the House in May proposed a 21% tax on certain university endowments, potentially impacting institutions like Stanford. Stanford University held an endowment valued at $37.6 billion, as of August last year, the fourth largest among US universities.
The proposed endowment tax is expected to cost Stanford University approximately $750 million annually. The current endowment tax rate at the university is 1.4 percent, as per the Stanford Daily newspaper.
"That is significant and of course it creates a huge financial burden for Stanford," said Julian Vogel, a professor of finance at San Jose State University.
The Trump administration froze over $330 million in funding for the University of California, Los Angeles, last week, citing the university's alleged failure to address a hostile environment for Jewish and Israeli students amid ongoing student protests following the outbreak of the Israel-Palestine conflict, reports Reuters.
The US government recently concluded its investigations into Columbia University and Brown University, with Columbia agreeing to pay over $220 million and Brown committing to a $50 million settlement.
Both universities have also accepted certain conditions set by the government. Negotiations with Harvard University are still underway, reports Reuters.