texas universities shedding jobs

Coronavirus Driven Financial Crisis Forces Texas Universities into Job Shedding and Lay-Offs

The pandemic has taken a toll on the financial health of college campuses across the nation, particularly in Texas. The pandemic has drained $11.5 billion in the state’s budget, as Texas A&M coronavirus fallout has led to $147 million in lost revenue. The governor has asked state agencies, including colleges, to plan on tighter budgets. Here are more in-depth details on how Texas institutions are dealing with this financial crisis.

Current Financial State of Texas Education

The University of Texas System encompasses 8 academic institutions and faces a state education budget cut of $77 million. Meanwhile, the Texas A&M System comprises 11 campuses and must cut $64 million. Leaders of both higher education systems have asked Governor Greg Abbott to reduce the 5 percent cuts. The Legislative Budget Board is now considering reduction proposals.

Texas A&M President Michael Young has stated trimming the school’s budget by 5 percent equates to cutting 72 faculty positions and research funding by $7 million. An additional 114 jobs are in jeopardy of getting squeezed. A major concern among educators is reducing student support will lead to a lower number of graduates and overall enrollments.

Universities rely on tuition and fees for revenue, as well as state funding and outside services. They also make money from bookstore sales, which depends on a market that values education. But if the quality of education doesn’t meet student expectations, it could lead to fewer enrollments. Although colleges can improve students’ education experience with virtual classes, transformation to a new digital model is an expensive endeavor.

UT Austin, which has furloughed over 260 employees during the pandemic, faces a $28 million budget cut. Campus officials are now considering downsizing academic and administrative departments. In the meantime, the school has suspended salary increases.

Strategies Proposed and Implemented To Deal with Financial Loss

The pandemic has been costly to colleges in numerous ways. Campuses have had to issue refunds for the Spring 2020 semester for dining and housing credits to students who planned to live on campus. Social distancing has required shutting down campus housing. These refunds alone account for millions in losses.

According to the office of U.S. Senator John Cornyn, Texas universities received federal relief in the spring, getting $1 billion of the nearly $14 billion national budget allotted for higher education. Over 25 percent of the funds went to the A&M and UT institutions. Recipients of the pandemic relief package included Texas A&M’s flagship campus (about $40 million) and UT-Austin ($31 million). Half of this sum was allocated for student emergency cash grants, leaving the institutions with little relief to cover their losses.

Each university must consider reducing the most significant contributor to its expense, namely the faculty and staff members. Campus officials must weigh both the quality and quantity of education, arriving at a new ecosystem that propels the institution forward to greater heights. Unfortunately, many talented educators will lose their jobs as the universities endeavor to navigate the pandemic financially.

However, financial aid to students will remain unaffected by the cuts in the education budget as these are still considered a high priority by the state.


The future of Texas campuses, including private institutions, remains uncertain, apart from the short-term downsizing that appears inevitable.

Over the summer, UT-San Antonio let go of 243 employees and eliminated 12 vacant faculty positions. Additionally, the school terminated 69 non-tenured faculty members while trying to achieve its $9.6 million budget cut.

The trend toward Texas universities shedding jobs is likely to persist for a while.

Contact the professionals at McKnight Associates Inc. for more information about the financial outlook of higher learning careers. We are ready to offer you hands-on human resources consulting for colleges, universities, medical centers, and organizations of all sizes.