Cuts to Penn’s funding from the federal government resulted in significant impacts on University hiring and operations throughout the past year.
Throughout 2025, Penn has received threats from the federal government concerning its funding status, including instances where threats to withhold funding have been leveraged during negotiations. These disputes have impacted research, staffing, and graduate admissions rates.
NIH funding cuts affect graduate admissions
On Feb. 7, the National Institutes of Health announced a 15% funding cut that jeopardized $240 million in federal funding for Penn, a move which Penn President Larry Jameson called “serious” with “significant implications for Penn research programs.” Three days later, Penn joined 12 other universities nationwide in filing a lawsuit, which resulted in a judge temporarily halting the cut.
Three University project grants had their funding reinstated over the summer following appeals and a June federal court order.
Citing uncertainty in federal research funding, Penn directed department chairs in February to significantly reduce graduate admissions, and in some cases, to rescind acceptances that had already been made. According to documents obtained by The Daily Pennsylvanian, Perelman School of Medicine faculty were instructed to cut Ph.D. program admissions by 35%.
Then-Interim School of Arts and Sciences Dean Jeffrey Kallberg called reductions to graduate admissions a “necessary cost-saving measure” in light of the impact of NIH funding cuts.
Eight months later, programs reported varying impacts, with SAS and Medical School professors reporting smaller-than-usual first-year Ph.D. student cohorts and potential impacts on teaching assistant availability. Multiple SAS professors reported a modest increase in the cap on admitted students for the 2026-27 cycle.
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Penn Executive Vice President Mark Dingfield said in an interview with the DP that funding losses, including “a major cut to Medicaid or other areas of support,” require close monitoring and “conversation with the Health System leadership.”
He added that “outside credit rating agencies also look at [Penn and Penn Med] as one single entity,” meaning that “if the Health System or the University is not performing well … it affects our ability to borrow at certain rates.”
Hiring freezes across Penn
Penn implemented a hiring freeze in March as a “proactive financial measure” in light of disruptions caused by federal funding cuts, allowing schools to only hire faculty that schools deem “essential to their missions and their highest critical priorities,” and that staff hiring would be frozen except for “critical positions, student workers, and those funded by active grants or restricted sources.”
The hiring freeze came alongside a freeze on staff salary mid-year adjustments and a 5% reduction in non-compensation expenses across Penn’s schools and centers.
Staff reductions individually impacted several of Penn’s schools, with the School of Social Policy & Practice reducing its staff by 8% due to “significant budget challenges” and a need to “better align our staffing and resources with current enrollment and financial realities to build a strong, sustainable future.”
The Annenberg School for Communication also announced that it would not renew its part-time lecturers’ contracts for the 2025-26 academic year, with Annenberg School Dean Sarah Banet-Weiser saying the decision reflected the school’s “current financial reality.”
The White House targets Penn
On March 19, the Trump administration froze an additional $175 million in federal funding to Penn, citing Penn’s policies allowing transgender women to compete in women’s sports. A month later, the Department of Education announced that Penn had violated Title IX by allowing 2022 College graduate and former Penn swimmer Lia Thomas, who is a transgender woman, to compete on the women’s team.
Under a negotiated agreement announced on July 1, Penn agreed to comply with all Education Department demands regarding its Title IX compliance, including a statement affirming compliance with Title IX, the restoration of accolades that were “misappropriated” by transgender athletes, and apology letters to all athletes affected.
On July 2, Jameson sent a letter to the Penn community reaffirming the University’s “unwavering” commitment to “ensuring a respectful and welcoming environment for all of our students.”
“At the same time, we must comply with federal requirements, including executive orders, and NCAA eligibility rules, so our teams and student-athletes may engage in competitive intercollegiate sports,” Jameson wrote.
In October, the White House invited Penn to sign a compact that would require adherence to a set of principles in order to receive preferential funding. Penn rejected the compact on Oct. 16.
The compact originally stated that while universities are “free to develop models and values other than those listed in the document,” they will “forgo federal benefit.”
Penn has received no further threats to its federal funding status as of time of publication.
