USC freezes hiring due to federal funding challenges

The University of Southern California has implemented a series of austerity measures, including a staff hiring freeze, in response to financial uncertainties stemming from federal funding challenges and ongoing investigations by the President Donald Trump administration. In a letter released Monday, university leaders, including outgoing President Carol Folt, cited "federal funding uncertainty" as a primary concern.

Among the nine measures outlined are a reassessment of capital spending projects and restrictions on discretionary spending. The letter emphasized the need for "bold action now" to enhance financial resilience amid "exceptional financial uncertainty," noting that USC received approximately $569 million in research funding in the fiscal year 2024.

These financial precautions follow a November report from an internal financial planning task force, highlighting a $158 million budget deficit and recommending various cost-containment strategies.

USC is currently under investigation by the Department of Justice and the Office for Civil Rights over allegations of antisemitism, largely linked to pro-Palestinian protests and subsequent police actions on campus during the Spring 2024 semester. 

The university has already made notable changes, such as deleting the website for its Office of Inclusion and Diversity, merging it into another operation, and removing several diversity, equity, and inclusion (DEI) statements from college and department-level communications. Additionally, faculty positions have been renamed, and references to certain scholarships have been removed, as per the Los Angeles Times report. 

USC is not alone in facing financial challenges due to federal scrutiny. The University of California – also under investigation for alleged campus antisemitism – announced a hiring freeze and other measures earlier this month. Dozens of other universities are subject to inquiries by the U.S. Department of Education over alleged antisemitism or race-based discrimination. 

Faculty members at USC have expressed concern over the recent developments. "I think everyone recognizes this is universal to research [universities] across the country. The Trump administration is behaving with such hostility and capriciousness," Darby Saxbe, a psychology professor, said. She also noted the "bewildering landscape" academic institutions face due to the uncertainty.

Sanjay Madhav, an associate professor at the USC Viterbi School of Engineering, voiced apprehension about the hiring freeze's potential disruption to ongoing projects, including a computing initiative currently in the faculty interviewing phase. 

"We have... candidates scheduled to fly in over the next few weeks," he said. "There is a lot of concern we could be interviewing all these candidates, and potentially, there could not be a job for them."

The Trump administration has taken steps to reshape the higher education landscape, including the National Institutes of Health issuing a rule in February that reduces funding tied to medical research. A federal judge issued a preliminary injunction earlier this month, temporarily halting these cuts. 

USC declined to provide additional comments beyond the Monday letter and the November financial planning memo.

As universities nationwide grapple with these challenges, the long-term impact on academic and research missions remains uncertain. The higher education community continues to monitor federal actions and their implications closely.