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Tough Economy Hitting Academic Hiring and Financial Aid

If you think the academic world might escape today’s tough economy, think again. Saturday’s New York Times
reports on many institutions, private and public alike, cutting faculty
jobs, freezing new hires, reducing financial aid, and in some cases raising tuition.

The economic downturn–what former Labor Secretary Robert Reich now calls a "mini-depression"–
has reduced the returns from many university endowments, which depend
largely on investment income to fund a part of their operating expenses
and student financial aid. Vassar College in Poughkeepsie , N.Y., for
example, saw the value of its endowment drop almost 10 percent since
June. And Dickinson College in Carlisle, Pa. saw its endowment drop 20
percent since that time.

The bad economic prospects are forcing
students to consider public colleges over private institutions, but
states are also facing tough times as sales, income, and property taxes
go down. In California, Governor Arnold Schwarzenegger proposed another
$65.5 million cut for the state’s university system, on top a $48
million cut already announced for this year. In New York , some state
schools have already announced tuition increases to cover budget

Faculty at public and private institutions face job
cuts and hiring freezes. University of Florida has cut 430 faculty and
staff positions, and is expecting another 10 percent cut in state
funding next year. Arizona State University has ended contracts with
200 adjunct faculty. Boston University, Brown, and Cornell have
announced hiring freezes.

Some campuses, particularly private
institutions, that had previously announced more generous financial aid
for students, are finding it harder to stick to those plans. Tufts
University in Medford, Mass., has had a "need-blind" policy for two
years, where the university would admit the best qualified candidates
regardless of financial needs. Tufts has suspended its capital projects
to make more funding available for student financial aid, but that may
not be enough.

S. Bacow, president of Tufts, told the Times, "The target of being
need-blind is our highest priority. But with what’s happening in the
economy, we expect that the incoming class is going to be needier.
That’s the real uncertainty."

3 comments on “Tough Economy Hitting Academic Hiring and Financial Aid”

  1. Lisa P says:

    Predatory lending may be a term applied to payday loans by some; especially those bought off by banks and credit card companies, but not by many payday loan customers. The public can easily be offset by claims of outrageous interest rates, but the claims are mostly bunk. The APR, or annual percentage rate, that is claimed by many detractors of 361% is preposterous. The fee for most payday loan stores is between $15 to $30 for every $100 taken out, which if repaid on time, usually in a one to two week period, equals out to 15 to 30% interest. To accrue the 361% interest, you would have to lapse on payment for an entire year. Then again, like any other service, a payday loan lender will add interest and fees for late payments. If you are late on a mortgage payment, you will get hit with a $75 fee, which you can avoid if you take out a payday loan if you end up short by a hundred dollars or so. Applying for a payday loan is fast, easy, and if approved, you can even have the funds direct deposited into your checking within a few hours.

  2. dan says:

    Applying for a payday loan is fast, easy, and if approved, you can even have the funds direct deposited into your checking within a few hours. That’s true, thanks.
    Dan, anunturi

  3. Ariel says:

    Lisa is right on. I work directly both with borrowers and folks looking to consolidate and escape their payday loan debt. Borrowers are grateful for the opportunity and usually are shut out of more traditional lending products. They aren’t the best loans on the block, but that was never their intent. Payday loans are second chance loans for people that find themselves in a bind, and regulating the industry into oblivion only hurts the consumer who has nowhere else to turn. If managed improperly they can be dangerous, but so can a car.

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