Dear Colleagues –
The COVID-19 pandemic is unprecedented in the scale of disruption it has caused globally, nationally, and at the MBL. Because of your dedication and hard work, the laboratory has managed to stay operational throughout the crisis. Your passion for and commitment to excellence, even in the face of COVID-19 challenges, is something I value highly and for which I am continually grateful.
This pandemic has temporarily thwarted our ability to fulfill our research and education mission and has had—and continues to have—serious financial consequences for the institution. I am writing today to provide an update on the financial impact on the MBL.
The economic struggles and uncertainty caused by this pandemic will continue for some time. Millions of workers in the United States have lost their jobs in the past two months, resulting in a decline unseen in recent history. There has been a severe slowdown in economic activity worldwide, and the MBL is not immune to this financial downturn.
We estimate the negative impact for fiscal year 2020, ending in June, will be approximately $1.5 million. For fiscal year 2021, assuming continued impact on our courses and conferences through December 31, 2020, the additional negative impact will be approximately $4 million.
There have been dramatic impacts on most every major revenue source for the MBL, including housing, dining, and conference revenues, tuition from educational programs, philanthropy, and endowment values. These declines will likely continue for the duration of the pandemic.
We will overcome this crisis, but it will require major actions on our part. The responsible financial decisions we make now are essential to not only mitigating today’s challenges, but securing MBL’s future.
In response to the events so far, we have taken the following actions: salary freeze – all individual faculty, staff, and administrative salaries for the this fiscal year will remain at current levels; staff hiring freeze – new staff will be strictly limited to those fully supported by external grant funding or critical to MBL’s core mission; decrease in discretionary spending and a 15% reduction in non-personnel, non-grant/gift funded costs for fiscal year 2021.
These actions will help mitigate the current financial impacts, but as the full economic effects of the crisis emerge, additional cost saving measures will be required in the coming weeks. We are exploring a number of different options, up to and including furloughs, but we continue to be committed to preserving our work force as much as possible. We recognize the uncertainty created by this crisis and will continue to communicate with you as we make these important decisions.
In its 132-year history, the MBL has weathered the storm of numerous events, from hurricanes, to the World Wars, to the Great Depression, to the 1918 influenza pandemic. In each case our community was called upon to adapt, be resilient, and find new and resourceful ways to ensure that the basic science done here can continue to catalyze the fundamental breakthroughs that expand our understanding of the world, and ultimately improve human health and the health of our planet.
While this pandemic poses incredible challenges, I am confident we can overcome them by embracing the values that have allowed MBL to flourish during its long history. We are fortunate to have the confidence and support of the University of Chicago and of our Board of Trustees and we will get through this, together, by supporting one another and our shared commitment to the MBL.
Thank you for all that you are doing for the MBL.
Nipam H. Patel