Harvard freezes staff hiring, scrutinizes faculty searches

Harvard should be a beacon in these times, providing employment for people in need. Of course the wealthy aren't really suffering. They don't know what it means to be evicted or have no heat. But oh how they moan and complain.

who give a damn if the harvard have no money. They only except the rich and occasionally bring in some minority to make them look good.

God forbid Harvard would spend a dime of their own endowment to get them through this temporary rough patch.

A year ago in the Harvard Employee newspaper when the endowment was growing at a fast pace. An employee ask why our salaries' were not grow as fast as the endowment. We were told that our salaries' were not tied to the endowment. But not I guess it is now! mmmm

Harvard is a big place. When your headline says "Harvard" but the article only pertains to one of many tubs, it's misleading.

Harvard is rolling in money. The endowment is likely much higher than it was just 2-3 years ago due to well diversified investment strategies. Morever, it will likely continue to grow faster than others due to quality management. Compare this with the S&P 500 index which last Friday was at an 11 1/2 year low (not including dividends). Once of these days, the political elites will rise up and tell Harvard to either spend 5% of the endowment yearly or lose its tax exempt status. FYI, 5% of $37B is $1.85B.

I dread going to work everyday becauase of my incompitent bosses. I have lost all respect for them. They are only in that postion because they have been there long. Its too bad because there bad, dimeaning, and all out disrespectfull attitude rubs off on people. So in a small group of 5 in a large company its hard. A lot of Boston managers or wan-a-bee successful poeple think they are big shots just becasue they have so-called people under them and make 65K lousy dollars. they will step on anyone to get ahead or look good..

"He reassured the department heads that Harvard remains committed to the tenure-track system and that promotion reviews will continue on schedule and will be based strictly on merit."

That's easy for him to say, since almost no one gets tenure at Harvard anyway!

Oh bogus! This is absurd!

We were told our universities and hospitals are engines of economic growth, and will inoculate us against any economic downturn! How can we be immunized against economic stagnation of there's a HIRING FREEZE! Duhh.

Anyway, it's all contained to subprime!

Wonderful! After years of obscene bonuses to their investment team, this over-rated, bloated farce of an educational institution (save for their libraries and museums) is finally being forced to face reality.

Believe me, the staff--at least the ones who actually produce--are not getting rich. The financial bleeding is from other arteries.

I know; I worked there.

Your headline is quite inaccurate. FAS may be the largest faculty within the university, but it's not 'the' university.

Doesn't Harvard have the reputation of using and tossing its junior faculty anyway? What tenure?

In reference to paragraph two, I am amazed that Harvard has a special dean for oversized Harvard professors. There must be a large number of ex-football players who go on to teach at Harvard. I wonder if he negotiates special discounts for them at the Big and Tall shops?

It is good that at long last reality is sinking in. Any how, the quality of the comments is a good indicator about the quality of staff and faculty that Harvard has been hiring. Good luck.

Actually, a sizable portion of the endowment is given every year to support the school. Something like a third of the operating budget comes from the endowment. Moreover, Harvard in recent years has ramped up its giving to lower and middle income students, so that very few students are the "rich" you are lambasting here. Without the revenue from the endowment, the school will either have to cut scholarships to the poor or cut jobs. It is certainly not an easy decision to make.

I think most people believe that the endowment works like an ATM from which Harvard can pull money whenever it likes. Harvard is actually required to spend a percentage of the endowment every year, which goes towards school operating budgets. When the amount of the endowment goes down, the amount that these schools get in their percentage goes down. Schools use that percentage as part of their operating budget, like FAS, who depends on the percentage for 50% of their operations. Hence, when the endowment is down, they receive less money from it, and their operating budgets suffer. The endowment isn't just a pile of money that can be used indiscriminately.

I asked the Dean of Harvard B-school if he felt any responsibility for the American made financial fiasco. he said plainly."no". well his graduates are responsible for trillions in losses. They sold worthless assets to the world and to Americans and then extorted trillions from the American taxpayor. Harvard should be shut down until a full investigation is made. Harvard is responsible for more destruction than any other institution. America's elite? Please.

You underestimate what a great Union workforce Harvard has. Harvard works because WE DO.
Eighty percent of Harvard students receive some kind of finanical aid and admissions are truly need blind.

"Love Story" was made 30 years ago and wasn't close to accurate then.

The figures are very large but so are the expenses of running such a great University.

Don't get me wrong, education is a very good thing. I have an associates degree and really uneducated by any standard means, I was handed down no money, but in America we have the luxory of deciding how are lives turn out. I'm just a hard working dummy who makes over 6 figures * 3

darn John
Harvard have no money??
And they only except the rich??

I can see a great selection pool for Harvard in your neighborhood!!
The great American education system shown at its finest

Harvard has need blind admissions and the endowment is down a large amount. The money generated is needed to fund the incredibly amount of financial aid (If your family earns under $140k, you get financial aid, if under $65 k or so, you get it entirely coverred).

Here is the inside scoop. The word is that the endowment is down more than 40%, and that is not including the private equity portfolio. Further to that, the PE portfolio is being rejected by secondary players at 30 cents-on-the-dollar. Harvard runs one of the few levered portfolios in the mega-endowment world... and they are paying the price..

All the Harvard-trained crooks on Wall Street are no longer making hundreds of millions per year meaning that Harvard's endowment fund will suffer. If that isn't justice, I don't know what is. Maybe they should divert some of what's left to a few good programs in business ethics.

Why don't thet do a real story about the poor public colleges who are already underfunded and have to endure more cuts! Does a university with a multi billion dollar endowment really need to cut spending? I'm tired of the Harvard's, MIT's, BU's etc... whining about money!

An organization that fails to bring in new people on a regular basis will not keep current and will fail to grow or correct mistakes of the past.

No reason to panic - even if the endowment is down by 40%, you can still run a school with $20bn and it will be back at the same level in a few years.

Besides, this is a common policy at all companies - public or private - to send out a message of frugality during the crisis. It makes leaders look good.

In reality, there will be exceptions and hiring will continue just as usual.

Based on what we have been told, 15% of cash flow has disappeared for next year's budget at FAS. That's based on a 30% fall in the value of the endowment. Many of us think that will be higher because Harvard bought so heavily into venture capital, hedged commodities and other illiquid positions.

FAS gets > 50% of its operating budget from endowment payouts. That is the highest percentage for large universities in America. The hit to the budget is consequently greatly magnified when asset prices drop.

C

Harvard like many of the Financial investment"Experts" they hired got giddy as the subprime "bonanza" made on the backs of the less sophisticated placed visions of endless wealth in their sights,....now comes the fall!!
Perhaps more solid conservative "placid" investment advisers who understand Bonds will pick up the pieces.
Where was Larry Summers whom they had dumped on when they needed him? He has now been selected to guide the rest of us . What will be in store?

I grew up in Boston and did not go to Harvard. I didn't even go to College, but I'm glowing at the fact that my grammar and spelling is a heck of a lot better than most of the people who are choosing to comment about that fantastic institution. Go Crimson!

We ask poor kids have to make the supreme sacrifice of fighting and dying in Iraq and Afganhistan but these people can't even risk a little of their precious endowment to keep the local economy from tanking further.
Brains is so stupid.

You forgot one of the worst Harvard MBA crooks of them all-George W. Bush. I grew up in Dorchester. My father died during my second year in high school. My family was on welfare, food stamps, etc...I went to Harvard and paid 800 dollars per year. That included room and board. It's a common misperception that only rich people go to Harvard College.

The amount of money the FAS gets from the endowment is completely arbitrary; it's not at all based on endowment income. When the endowment goes up 20% in a year the schools don't get more--they get the same 5% as always. So this "crisis", just like the last FAS "budget crisis" it is utterly trumped up. Why punish the schools in a year when the endowment falls 30% rather than rises 30%? The coming cut to the FAS budget is totally unnecessary and wrong.

Congratulations to Scott St. Pierre who did not go to College but managed to write in an eloquent way with no spelling mistakes. The rest of you should be ashamed of yourselves, go back to school and learn how to spell!!!

It is not just Harvard, other insttiutes such as University of Rochester, Sch. Med. are consideirng staff hiring freezes, compensation and salary freezes and making promotion criteria to tough to match - thanks Walls Street !! Thye idea to cease recruitment and faculty searches is a good one. Faculty searches are wasteful of funds. Faculty are given 1st class hotels, 1st class treatment and so on that edits awar funding. We should be more modest in our use of public money - senior managers are also a little dishonest and I would have financial auditors spot check divisional and departmental spending as a matetr of urgency and randomly (spot check means no warning given !!). It is the top institutes that are the worse culprits. All I can say is that they are veyr imaginative accountants and they (the crooked med school accountants) need to be filtered out of the system and fired.

I work at Harvard and I know that 60% of undergrads are on some type of financial aid. So to say that all students at Harvard are rich is not true. I work at Harvard and am involved in the Union. Until we see how things play out in the next month or so I am not too worried.

HUCTW works for its members and will make sure we are okay.

There will be some delicious irony for the university world this year because the "rich" will be hit hardest by this collapse. Compare Harvard with some small school with no endowment. Harvard pays for fancy buildings and lots of staff by taking 3-5% of its endowment out each year. Their endowment is so big that more than 50% of the maintenance and large staff are paid for by this 3-5% draw.

Now, imagine a bad year where the endowment drops 30%. Harvard could take out 4-6% this year, deplete the endowment even more, and keep all of the buildings well-maintained by a fat staff. Or Harvard could start firing people like crazy, take only 3% out, and manage to squeak by.

What happens if this downturn continues for three or four years, something that's entirely possible. If they continue to take out 5-6% of the endowment and each year and the investments merely break even, they'll still be left with something that's half of what it was at the peak. Four to five years of taking out 6% is more than 25% - 30% of the endowment. That's a real hit and it's entirely possible that it will happen.

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