University leadership announced nine measures to “limit and reduce expenditures” effective immediately, citing financial stress from federal funding cuts and an ongoing structural deficit in a letter published to its “We Are SC” website Monday morning. Steps included a staff hiring freeze, restricted hiring for faculty and a pause to merit-based raises for most faculty and non-hospital staff positions from the 2024 performance cycle. 

In the 2024 fiscal year, the University received roughly $650 million in student financial aid and $569 million for federally funded research, the statement read. These funds are in jeopardy with President Donald Trump’s moves affecting higher education — including attempts to dismantle the Department of Education and caps on the National Institutes of Health’s funding for research. 

Monday’s letter said the University was in a “structural deficit,” meaning the University’s operating cost exceeds its revenue. 

S&P Global Ratings, a corporation that does financial credit ratings, analyzed USC’s future rating outlook as “negative” on March 19, citing an increased debt ratio and an operating deficit.

A negative outlook means that the University’s long-term “AA” rating — the third best credit rating — has the potential to fall in the next two years. A rating downgrade could increase the cost of borrowing. 

Michael Bodie, an associate professor of practice of cinematic arts said faculty were not surprised about the budget cuts, but were not given a chance to understand why the budget was cut in that way. Bodie is an organizer for United Faculty-United Auto Workers — the group currently undergoing National Labor Relations Board hearings to allow a vote to unionize among research, teaching, practitioner and clinical-track faculty after the University challenged their initial petition to unionize.

“[This] is a perfect example as to why we need a union, because we don’t actually have a real seat at the table as far as governance goes,” Bodie said. “The administration can blanketly make these major cuts without any discussion with faculty and we have no ability to have recourse.” 

Bodie said a lack of transparency between the University and faculty has been a consistent issue.

“There’s some deep frustration and concerns about what [the University is] choosing to target and how they’re targeting it without any real information for everyone — all the vested parties — to be able to understand truly why this is the only solution and the best solution,” Bodie said. 

Sanjay Madhav, an organizer for UF-UAW as well as an associate professor of technology and applied computing practice, said the pause on merit-based wage increases will make faculty lose money in the long term.

“Because we don’t get cost of living increases as faculty, the only way our salaries can even attempt to keep up with inflation is through these merit raises,” Madhav said. “By eliminating them, it just means that our salaries are going to continue to fall behind our peer institutions.” 

Bodie said he was looking forward to a raise this year after he finished a big project last year and got a top score for his merit evaluations. But with the pause on merit increases, he said he may not get that raise. 

“[The University has] often taken from the backs of the faculty and staff in order to balance their books,” Bodie said. “But they don’t then turn around and make folks whole when everything is better again.”

The School of Advanced Computing is in the process of hiring new faculty and Madhav, who is involved in the hiring process, is now uncertain if he can move onto interview with the faculty hiring restrictions. 

“We were told [by the University] we could probably argue for three to four faculty, maybe even five faculty,” Madhav said. “But now it’s unclear, with this new curtailment, whether we’ll even be allowed to hire one new faculty.”