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January 21, 2022

Precautions help Hopkins through economic recession

By Peter Sicher | November 11, 2009

While Hopkins has implemented several drastic measures in order to keep its budget balanced through the continuing economic recession, its endowment has begun performing better than originally predicted, allowing the Krieger School of Arts and Sciences to lift the hiring freeze.

Nineteen members of the Hopkins administration voluntarily cut their salaries by five percent on July 1, the beginning of the current fiscal year.

"I think everybody recognized that this is an extraordinary time, financially, for the University. Everybody is making sacrifices to address the budget situation the University has and they were in a position to personally do ever more," Hopkins spokesman Dennis O'Shea said.

Administrators who took salary reductions include the president, vice presidents and the Deans.

Funds saved from the deans' salaries were distributed to programs in the deans' respective divisions. According to O'Shea, some of the money saved was also used to support financial aid.

"The central administration's salary [reduction] was used for undergraduate financial aid budgets." he said.

O'Shea would not disclose how much money was saved by these salary reductions.

"We don't talk about specific budget items," he said. It has not yet been decided whether or not the salary reduction will continue into the 2011 fiscal year.

According to O'Shea, while endowment was affected by the recession, losses were not as high as expected.

"Obviously in the first six months of this calendar year - the last six months of the fiscal year - there was a recovery in the markets. That did lead to the worst forecasts about endowment for fiscal 2009 not coming true," he said. He is hopeful that the endowment's performance will continue to improve.

"The markets thus far during the year have done very well. My retirement plan is doing better than it has, your parents investments are doing better than they have been and the University's investments are as well," he said. He stressed that conditions could still change.

"We don't know how this fiscal year will turn out. We are less than halfway through it. It would be disingenuous of me to be anything other than cautiously optimistic at the moment," he said.

While the freeze has been lifted in the School of Arts and Sciences, it remains in place in other divisions.

"We had to put most of our faculty searches on hold last year because of budget cuts and the hiring freeze but we were able to see our way clear to initiate a couple of [searches] subsequently," Dean of Undergraduate Education Paula Burger said.

According to Burger, additional financial support for some of faculty searchers came from the increase in funds from tuition because of the unexpected over enrollment in the freshman class. The freeze did not have a strong effect on fledgling majors.

"This didn't really affect the archeology major at all because that is coming on line next year. We were only planning on hiring a professor this year. There is now a search ongoing for [that position] because at this point the hiring freeze is lifted," Dean of Faculty David Bell said. He said the new interdisciplinary sustainability major will also be unaffected.

"Last year we did delay the employment of one professor who would have come in and contributed to that program. However there are three new faculty members in that department, two of whom came this fall and one who is coming in January, who are already contributing to the program." Bell said.

The program is currently searching for a fourth faculty member, and plans for the official launch of the major are on-schedule.

Other empty positions, however, still remain unfilled. "In my office we have several frozen positions and those positions will remain frozen as long as the freeze continues," O'Shea said.

Executive positions, however, will not be effected by the freeze. These include the search for replacements for Bell, dean of the School of Arts and Sciences Adam Falk and Dean of the Education School Ralph Fessler.

"Those are obviously very critical executive positions and [it] would cause considerable dislocation if we didn't hire," O'Shea said. He also said that where the University received money to support specific projects, hiring was able to continue.

"The research grants we have received under the Federal economic stimulus act have involved hiring. That kind of position has been exempted from the freeze," O'Shea said.

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