USC Faces $200M Deficit, Risks Research Funding Loss

The University of Southern California (USC) is confronting a major financial shortfall, ending its 2025 fiscal year with a deficit exceeding $200 million, an increase from $158 million the previous year. Interim President Beong-Soo Kim cited both internal factors, such as rising expenses and weak revenue, and external pressures, including substantial federal funding cuts under the Trump administration and a decline in international student enrollment. USC faces the potential loss of up to $300 million annually in federally sponsored research funding, with additional risk from changing national policies affecting higher education. In response, USC has implemented layoffs, a hiring freeze, budget cuts, the sale of unused properties, and pay adjustments for top earners, though these may not fully resolve the deficit. These challenges are mirrored at other major universities facing similar austerity measures. Kim stressed that without decisive actions, the ongoing deficit could threaten the university’s long-term stability and future investments.