In response to uncertainty about the health of the U.S. economy, Boston University President Robert A. Brown has imposed a freeze on the hiring of new employees and on commitments to capital projects for which construction contracts are not already in place.
In a letter sent yesterday to faculty and staff, Brown said he was acting preemptively to manage the potential short- and longer-term risks created by the current economic uncertainty.
“The collapse of several long-standing financial institutions and the degrading capital markets have created unprecedented volatility for our students, their parents, and the University,” said Brown. “Hopefully, the economic conditions will brighten in the weeks and months ahead and we can lift these constraints on our operations.”
Boston University Executive Vice President Joseph Mercurio said the University is acting out of concern about students' and their parents' ability to afford a college education if the economy does not rebound.
“If unemployment goes up or if capital markets don’t improve and students are unable to borrow money, it could put us in a position where we need to offer more in the way of financial assistance,” said Mercurio. “We are being prudent, taking precautions to protect our students, faculty, and staff by husbanding our resources.”
Mercurio said BU had just completed the best two fiscal operating years in the history of the University and the current budget remains on target. He said the University’s endowment of $1.2 billion had increased 2 percent in the year that just ended, and last year was in the top quartile of performance for all universities that report their endowment. In the past year, he said, the University has received two bond upgradings, one from Moody’s and one from Standard and Poor’s.
Mercurio said the University would go forward with the hiring of any positions that affect public safety and dormitory security. Other positions will be examined before hires are made.
Art Jahnke can be reached at email@example.com.