SEATTLE — June 30, 2020 — Fred Hutchinson Cancer Research Center announced today that 76 employees are being laid off from its South Lake Union campus, and 81 open positions are being eliminated. The layoffs come after a series of cost-cutting measures implemented since March. These latest steps are intended to reduce a projected revenue shortfall of nearly $50 million over the next 12 months due to increased volatility in variable revenue sources including philanthropy and investment income. Although the percentage of impacted positions is less than 5% of the center’s overall workforce, the layoffs are all from the center’s Administrative Division.
In an email sent to employees today, Dr. Thomas J. Lynch Jr., president and director, expressed the following:
Today marks a difficult day for our Fred Hutch community.
As you know, Fred Hutch is not immune to the COVID-19 pandemic’s financial impacts. Despite our centerwide efforts to reduce expenses, we were not able to fully cover a projected revenue shortfall of nearly $50 million. In order to sustain our pursuit of cures for cancer and viral diseases, today we notified 76 employees that they are being laid off. We are also eliminating 81 open positions.
These are already exceptionally difficult times, and these layoffs add to the pain and deep sense of loss, especially for those colleagues who are leaving us today.
Although the effects of these steps will be felt by everyone in the organization, the layoffs and eliminated positions are all in our Administrative Division. All the affected roles are funded not by direct grant support but by other revenue streams, including Facilities & Administrative revenue from grants, philanthropy and investment income. These revenue sources are being affected by the economic downturn related to COVID-19, and they remain uncertain as long as the volatility continues.
We made the extremely difficult decision to implement layoffs only after enacting a series of other cost-saving measures and thoroughly evaluating a range of additional options. Our approach to budget planning throughout this pandemic has centered on supporting Fred Hutch research using the resources we have in the most efficient way. The steps we have taken, including today’s reduction in staffing, are all aimed at preserving the strength of our science and our ability to fulfill our mission far into the future.
Every employee laid off today will receive a transition package that includes severance pay, health benefit continuation for those who use our benefits, and a number of other services including job-search support. We will also ensure that any qualified and affected employees who are interested in roles that open at the center in the future are interviewed for those positions.
To those who are leaving, we are grateful for your passion, dedication, and everything you have contributed to our Hutch community and our mission. You are our colleagues and friends, and you will be missed.
In my short time here, I’ve been struck by the deep care and concern Hutch employees have for one another. I know you will continue to support each other.
As difficult as these decisions are, our intent is to ensure that the Hutch rebounds swiftly when the economic situation improves, and we will continue to advance the center’s lifesaving work even as we confront the losses and navigate the challenges presented by this global crisis.
I remain committed to keeping you informed and will devote our town hall this afternoon to discussing today’s news and taking your questions.
Thank you again for your compassion, hard work and commitment to the Hutch’s science, our community and our mission.
Beginning in March, the center started taking steps to decrease expenses. These included:
· Limiting expenditures for consultants and vendors
· Restricting hiring new and replacement positions (except for those fully funded by grants)
· Eliminating salary increases for FY 21 (July 1, 2020 – June 30, 2021)
· Reducing executive salaries by 5%. Executive leaders also agreed to waive the variable portion of their compensation in 2020 which can be up to 20% of their base salaries.
At Fred Hutchinson Cancer Research Center, home to three Nobel laureates, interdisciplinary teams of world-renowned scientists seek new and innovative ways to prevent, diagnose and treat cancer, HIV/AIDS and other life-threatening diseases. Fred Hutch’s pioneering work in bone marrow transplantation led to the development of immunotherapy, which harnesses the power of the immune system to treat cancer. An independent, nonprofit research institute based in Seattle, Fred Hutch houses the nation’s first National Cancer Institute-funded cancer prevention research program, as well as the clinical coordinating center of the Women’s Health Initiative and the international headquarters of the HIV Vaccine Trials Network.