University of Michigan anticipating losses up to $1 billion due to COVID-19
The University of Michigan is instituting a hiring and salary freeze as part of an effort to combat major financial losses because of the coronavirus pandemic. “Possible exceptions” are those positions fully funded by federal grants or roles considered critical.
In an email to staff today, President Mark Schlissel says U of M expects losses of $400 million to a $1 billion through the end of 2020 to “preserve financial resources.”
Spending on non-essential travel and conferences are on hold. Schlissel and other top U of M executives are taking voluntary pay cuts. Staff furloughs, so far, are voluntary, as are reduced hours.
“The actions I’ve mentioned are the result of two primary factors: All of the university’s major sources of revenue are in question, and we have incurred large, sudden, and unexpected costs due to the pandemic,” Schlissel wrote.
“The expenses include the pandemic response at our hospitals and clinics, coupled with the loss of revenue from non-urgent medical procedures and outpatient clinics,” he continued, noting refunds for employee parking and rebates for student housing and dining.
“These were the right thing to do to support our community, but were not part of our normal budget or monthly cash flow calculations. Additionally, the need for financial aid will likely increase as the families of many of our students have experienced reductions in income,” he wrote.
Plus, there’s uncertainty about the demand for classes, and even if U of M can safely bring students on campus this spring and summer semesters.
U of M holds Michigan Radio’s broadcast license. As of publication, it’s unclear if or how the action Schlissel outlined impacts the station or its staff.