Will layoffs spread from tech companies to higher education? | Within higher education

Meta, the parent company of Facebook, is laying off 13,000 employees. Twitter is laying off half of its 7,500 employees. Educational technology (edtech) companies are working through a painful downsizing for two months, with Layofftracker.com reporting deep headcount cuts at 2U, Byju, MasterClass, SkillShare, Eruditus and others.

Senior officials may think we are insulated from the spread of demobilization contagion to our campuses. We are not.

It is very easy to come up with scenarios in which many colleges and universities need to resort to downsizing to remain financially viable. The decline in enrollment may not be reflected after the pandemic. High inflation and low unemployment are the main disincentives for working adults to take on graduate debt. Labor costs, which make up the vast majority of every university’s budget, continue to increase rapidly. The areas where many universities have been looking to bring in revenue to counter the dual forces of demographic headwinds and diminishing public funding, i.e. developing new online degrees and non-degree programs, are seeing increased student acquisition costs and a significant drop in revenue compared to the past two years.

Here, the key word is “strength,” as universities have yet to announce layoffs of the scale seen during the 2007-2009 Great Recession or the stagnation of the Internet bubble in the early 2000s. Returns from recent giveaways have been average, but these losses come after two years of impressive gains. https://www.insidehighered.com/news/2022/11/08/endowment-returns-drop-ac … The United States may fall into a recession in the coming months, a shocking development that is also paradoxically useful to confront. Cyclical industries such as higher education.

So we may avoid the fate of technology, and large-scale layoffs will not come to our institutions. Let’s hope so. But since hope leads to poor career strategy, now is the time to prepare ourselves for waves of college layoffs, if they materialize on our shores.

What are some things that people without tenure security can do to prepare ourselves for the possibility of a layoff? Three ideas:

1 – Be careful when hiring:

Not everyone in higher education can have much say in decisions about recruiting new fellows. For those in management and leadership positions, however, knowing that large-scale layoffs have in the past reached a higher level and could come again, it might be wise to take some caution in hiring decisions at this time. As a leader or manager, avoiding layoffs should be among your top priorities. Downsizing takes a heavy toll on university culture, operations, and productivity. We are institutions built on trust. To be effective, university employees must do a million and one things that no one sees or recognizes. There should be a feeling that the organization invests in its employees as much as its people invest in the organization. Layoffs kill that confidence.

Here, I am concerned about recommending employment as universities suffer from what I have called an invisible staff shortage epidemic. https://www.insidehighered.com/blogs/learning-innovation/higher-ed%E2%80… At the moment there are very few people doing a lot of work around the campus. This reality of understaffing may be the other side of the pandemic-driven technology over-employment coin. So any further slowdown in hiring will only exacerbate the burnout and fatigue that many college students feel. However, at this point, I think being cautious in hiring is warranted.

2- Obligation to protect people’s jobs:

Again, this is more of a type of corporate strategy – or department or unit – but one that people working in higher education can follow. These people are, again, college leaders and administrators. College leaders and directors have to implement layoffs if they come. And if these layoffs reach a higher level, they are mainly caused by external forces beyond their direct control. (such as higher inflation, lower unemployment, higher labor and healthcare costs, lower public finance, lower enrollment rates with demographic and economic motive, etc.). What university leaders can do now is decide that, whatever happens, the institution will do everything (and I mean everything) possible to avoid layoffs. Commit now, and then work backwards to prepare for how to fulfill that commitment.

The time to explore anti-layoff strategies is not when layoffs are about to happen. The best time is now when things are steady (unshaky). One idea is to work towards a societal consensus that joint pain is better than downsizing. If the choice is between the highest-paid people in the school who get a 10% cut in salary, or the 10% of the most vulnerable employees are let go, those lucky, higher-paid employees may agree up front that this is a reasonable trade-off. The people who control college budgets should look at what can be cut before giving up on people. Figuring out how to save money outside of compensation (wages + benefits) is difficult, as most of the money we spend in universities is related to compensation. However, there are things we can grudgingly give up if the upside is to avoid layoffs.

3 – Be prepared to find another job:

Saying that we should be prepared to find another job sounds a bit harsh and stigmatizing. Nobody wants to blame the victims of demobilization has to come to the highest level. Higher education workers live complex lives, as partners, children, and family members become involved in the communities in which they work. Few of us can easily move our families to where the jobs are and away from where the jobs are.

Still, forewarned. Knowing that the layoffs we’re seeing now in technology may (maybe) reach a higher level should prompt all of us to consider our plan B. How much emergency savings can you throw away, meaning discretionary expenses you might be able to avoid? What are the prospects for doing freelance and consulting work if your full-time business is interrupted? Have you maintained contacts, networks, and relationships with your peers at other schools that can tell you when jobs are posted? Is your resume/resume up-to-date?

Reading tech layoffs should prompt those of us in higher education to have an open conversation about how to avoid what is going on in tech. Being clear about what we don’t want and what industries we don’t want to emulate is the responsible thing to do.

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