Boston University is cutting $50 million from its budget for the coming year and laying off 120 staff members amid the mounting economic turmoil facing universities under the Trump administration.
A message from university leaders on Monday pointed to “recent and ongoing federal actions” as the primary reason for the decision, which pulls back 5 percent of the budget from each department and accounts for 2 percent of the university’s entire $2.5 billion operating expenses last year. It also cited other challenges to higher education institutions, including rising inflation, declining graduate enrollment, and a looming demographic drop-off in high school seniors nationwide.
“This is a day of loss for all of us,” BU president Melissa Gilliam and other college executives wrote. “There is no way around this. We know our community may need time to adjust to these difficult changes. Yet, it is also a necessary step in ensuring our future.”
As a leading research university and popular destination for international students, BU could be disproportionately impacted by White House moves to restrict student visas and cut federal research spending.
Nearly a third of its students are from abroad, and many pay full tuition, helping to buttress BU’s annual budget. BU also received $579 million in research funding last year — a portion of which came from federal agencies, including the National Institutes of Health and National Science Foundation.
President Trump severed funds from those agencies to Harvard University earlier this year, and both may face significant reductions to their overall budget in the future.
In addition to the 120 layoffs, BU will also eliminate 120 jobs that are currently open, and around 20 additional existing positions at the college will “undergo a change in schedule,” according to the Monday message. In the spring semester, Gilliam announced that BU was pausing annual cost-of-living increases on campus.
“Every effort has been made to limit the number of layoffs, and these actions will apply to approximately 1 percent of our employees,” the announcement read.
Joshua Goodman, an education economist at the Wheelock College of Education at BU, said that the “unsurprising” cuts are in line with the federal government’s vision for a country with smaller and less influential colleges.
“The big picture here is that BU is not going to be unusual in the landscape of higher education,” he said. “The current presidential administration seems to have a goal of shrinking one of America’s most successful industries, which is higher education.”
This moment could exacerbate existing financial challenges at BU. In May, college officials warned faculty and staff that its finances were on an “unsustainable path,” the Daily Free Press reported, with expenses exceeding revenues every year since 2017. That divide stems from a significant uptick in financial aid offerings for students and unexpected increases in salaries and wages on campus.
Modernizing its new student information system, MyBU, has also proved costly for the university, requiring a $13 million infusion of cash. And declines in applications to graduate-level programs created a $38 million shortfall in revenue projections and contributed to a decision to not accept new students into dozens of humanities and social sciences PhD programs next year.
Around 3,000 graduate and PhD students who teach classes and conduct research at BU also received a sizable raise in October after a months-long strike.
Now BU may face additional challenges based on the outcomes of ongoing lawsuits concerning international students, uncertainty around future research funding, and a new increase to the federal endowment tax passed by Congress last week, which bumps up the rate from 1.4 percent to 4 to 8 percent.
And they are far from alone. Facing a complete elimination of federal funding, Harvard has instituted piecemeal cuts by laying off some staff and closing research facilities. MIT, Brown, and Wellesley, among other colleges, have paused hiring. Smaller schools, including Clark University and Worcester Polytechnic, have announced layoff plans in response to enrollment difficulties and ever-growing challenges in higher education in the second Trump term.
This story has been updated to show that the announcement calls for a 5 percent cut to each department at BU.
Diti Kohli can be reached at diti.kohli@globe.com. Follow her @ditikohli_.