Stanford University’s Hoover Tower on June 7, 2019. Photo by Sinead Chang.
Responding to financial headwinds from the federal administration, Stanford University this week reported that it will be laying off 363 employees, according to a notice that the university filed with the state Employment Development Department.
The layoffs are part of the university’s plan to reduce its budget by $140 million in the upcoming school year, according to a notice that university President Jonathan Levin and Provost Jenny Martinez sent to faculty and staff on July 31.
“This is the product of a challenging fiscal environment shaped in large part by federal policy change affecting higher education,” Levin and Martinez wrote.
The university issued the layoff notice on July 31 in accordance with the WARN Act, a state law that requires employers to provide a 60-day notice of mass layoffs. The action comes at a time when the Trump Administration is cutting research funding and taking other punitive actions against elite universities, in some cases based on claims of antisemitism.
Some universities, including Columbia University and Brown University, are reportedly paying tens of millions of dollars to settle White House allegations of discrimination, while Harvard University is exploring its own settlement, according to the New York Times.
The administration also suspended last week hundreds of research grants to University of California, Los Angeles, a decision that the White House claims was based on the university’s inadequate response to antisemitism. UCLA Chancelor Julio Frenk called the grant freeze “deeply disappointing” and said it will be “adversely affecting the lives and life-changing work of UCLA researchers, faculty and staff.”
While the latest round of layoffs was announced on July 31, Stanford has been bracing for budget cuts for months. In February, the university announced a hiring freeze in response to a reduction in federal spending. And in late June, university officials warned of looming financial pressure thanks to federal policies such as the increase in the endowment tax that was included in the federal government’s recently passed spending bill.
For Stanford, the tax rate on endowment is going up from 1.4% to 8%. Martinez warned in late June that the endowment tax will heavily impact undergraduate financial aid. The university’s updated budget cut $140 million from the general fund.
“There is significant uncertainty about how federal support for universities will evolve, but it is clear that the status quo has changed,” Levin and Martinez wrote at that time.
In a letter accompanying the WARN notice, Stanford asserted that economic uncertainty has created “serious operational and financial challenges for higher education institutions.”
“At Stanford, anticipated changes in federal policy—such as reductions in federal research funding and an increase in the excise tax on investment income—are expected to have significant budgetary consequences,” Elizabeth Zacharias, the university’s vice president for human resources, wrote. “These developments, along with rising operational costs, shifts in funding sources, and programmatic changes, have resulted in this workforce reduction.”
The list of layoffs includes development officers, graphic designers, administrative service administrators, business analysts, communications managers, librarians and student services officers, according to the notice.
David Canepa, president of the San Mateo County Board of Supervisors, called the endowment increase “economic sabotage.” In an Aug. 5 statement, Canepa criticized the federal bill that prompted the layoffs, which will unfold between Sept. 30 and Nov. 1 and impact research, administration, student services and other areas of the university.
“Stanford’s announcement that it is laying off hundreds of hardworking employees is a gut punch to our local economy and to families already struggling to make ends meet,” Canepa said in the statement. “Make no mistake, these cuts are the direct result of the so-called ‘Big Beautiful Bill,’ a devastating piece of federal legislation that prioritizes politics over people.”
Correction: The story had initially listed the incorrect rate on the endowment tax increase.
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