Citing a “more pessimistic outlook for endowment earnings,” President Tilghman announced April 6 that Princeton will freeze salaries in the coming year for tenured faculty and for staff earning more than $75,000.
The latest forecast from the Princeton University Investment Co. is for a 30 percent decrease — not the 25 percent drop announced previously — in the value of the endowment in the 12-month period ending June 30. Tilghman noted the “likelihood that next year will see no rebound in earnings.”
The salary freeze for higher-paid employees is a change from an earlier policy that would have capped increases for all University faculty and staff at $2,000, and is designed to save an additional $4 million, Tilghman said. It is part of a two-year target of $170 million in savings she said will be necessary to reduce endowment spending.
“The steady growth in both faculty and staff that we have enjoyed over the last 10 years will end, and the University will have to contract in size,” the president said.While Princeton will move ahead with design and approval work for the Neuroscience Institute, facilities for the Lewis Center for the Arts, and the Andlinger Center for Energy and the Environment, decisions to begin any new renovation or construction project will be made “on a case-by-case basis, contingent on having 100 percent of the funding in hand,” Tilghman said.