A report by the state Legislative Fiscal Bureau Thursday predicted a $300-to-$400 million budget shortfall in 2007-'09, with uncertain implications for the UW System.
All state agencies Friday were told by the Department of Administration to cease non-essential travel, hiring and leases, partially in response to the projected budget shortfall.
It's too soon to predict how or if these directives will affect the university,"" UW-Madison Spokesperson David Giroux stated.
Giroux said the university has already excluded jobs deemed unnecessary and all travel currently being done within the university is essential to research in other parts of the world.
""The biggest contribution [the UW System] can make right now to this state in its current economic condition is to keep doing what we do best: educating students, engaging in world class research and connecting Wisconsin residents with that knowledge,"" Giroux said.
According to Giroux, higher education can help strengthen a weakened economy better than anything else, and it is important the university remain efficient but also stay focused on its educational goals.
Professor of Public Affairs and Applied Economics Andrew Reschovsky said it is largely uncertain how the national economy will affect Wisconsin and, in turn, the UW System.
The state has already seen slow economic growth within the past year, with less revenues coming in from personal income, corporate and sales taxes, Reschovsky said.
According to Reschovsky, stabilization plans to boost the economy at the national level are likely to affect the amount of money Wisconsin can collect through taxes.
Budget cuts at the UW System level are very possible, Reschovsky said.
He stated raising revenue for the UW system could be done by raising taxes or cutting spending, though tax increases are unlikely because of how they are viewed politically.
""You could not cut taxes and put more money into the UW System which in my view would be a wiser and more effective way to spur economic growth in this state,"" Reschovsky said.
He said ultimately the state's economy is tied to the level of support given to higher education.
""In the long run, the economic health of this state is going to depend on having an educated workplace and investing in education.
