Stanford University has terminated the employment of 363 staff members, attributing the decision to new federal policies enacted during the Trump administration that have significantly disrupted higher education funding streams.

In a statement to the press, a university representative explained, “Stanford is in the process of making budget reductions… Last week, many schools and units made staff workforce reductions. In total, 363 layoffs occurred.” The cuts spanned administration, research, alumni engagement, and campus operations.

Affected employees are being offered severance packages and support services. As noted in a July 31 release, “These are difficult actions that affect valued colleagues and friends who have made important contributions to Stanford.”

In June, the university had already reduced its general funds by $140 million for the next fiscal year. The administration cited a “challenging fiscal environment shaped in large part by federal policy changes affecting higher education,” according to a joint message by President Jonathan Levin and Provost Jenny Martinez.

A key financial blow came from a steep rise in the endowment tax introduced via what the Trump administration dubbed the “Big, Beautiful Bill.” The tax on Stanford’s $37.6 billion endowment soared from 1.4% to 21%, significantly draining resources.

Simultaneously, federal research grants from agencies such as NIH and NSF have been reduced or frozen. This financial tightening follows allegations that the government is targeting universities perceived as allowing unfavorable campus protest activity or policies. Last month, the federal government froze over $330 million in grants to UCLA, citing inadequate protection for Jewish and Israeli students during Gaza protests.

Several institutions—including Columbia and Brown—opted for settlements to avoid funding cuts. Columbia agreed to a $220 million payment and Brown committed $50 million. Harvard remains in ongoing negotiations. Columbia issued a statement clarifying: “Columbia University has not admitted wrongdoing and does not agree with the government’s conclusion that it violated Title VI of the Civil Rights Act.”

Federal scrutiny of higher education is intensifying. Critics argue that the administration is conflating criticism of Israel with antisemitism, while punishing universities for hosting pro-Palestinian activism, supporting transgender rights, or investing in diversity and inclusion programs.

Civil liberties groups, educators, and student activists warn that this approach risks suppressing academic freedom and campus discourse. Protesters—including some Jewish voices—contend that their dissent over Israel’s Gaza actions is being wrongly labeled extremist or antisemitic.

Stanford’s mass layoffs underscore the growing fiscal squeeze facing elite universities as political tensions over campus ideology and federal funding policies escalate.