Measuring the Economic Risk of Federal Actions Against Harvard

Recent federal actions targeting Harvard University have sent shockwaves through Greater Boston’s research and education ecosystem. The termination of billions in research funding, the disqualification of the university from future federal grants, and new restrictions on international student enrollment present not just institutional challenges for Harvard, but economic risks for the entire region.

Let’s explore the potential economic consequences of these federal policy shifts, using IMPLAN data and modeling to understand what’s at stake.

Understanding the Scope

The federal actions in question include:

• Rescission of $2.2 billion in multi-year research grants and $60 million in contracts, largely from the NIH
• Freezing of approximately 500 NIH grants to Harvard-affiliated institutions, including major hospitals
• Disqualification from future federal grant eligibility
  
• Termination of $450 million in grant funding by eight unnamed federal agencies
• An additional $60 million cut from the CDC
• Federal directive to cancel remaining contracts totaling $100 million
  
• Announcement to halt new international student enrollment at Harvard

These decisions place enormous pressure on Harvard’s institutional operations, research activity, and international student engagement – all of which have deep ripple effects throughout the Boston economy.

Institutional Operations & Local Employment

Harvard employs approximately 20,000 people, supporting not just its own workforce but also jobs throughout the region via operational spending and employee household consumption.

Using IMPLAN data, we estimate:

• ~1,700 indirect jobs are supported through Harvard’s business-to-business transactions, contributing $240 million to local GDP
  
• ~5,000 induced jobs result from household spending, adding $760 million to GDP
  

Combined, the operations of Harvard generate nearly 7,000 additional jobs and over $1 billion in GDP for the Greater Boston region.

Research: A Billion-Dollar Catalyst

Federal research grants are a major engine of economic activity. For every $500 million spent on research in Boston, we expect:

• 1,380 direct research jobs
  
• 700+ supplier jobs
  
• ~1,000 jobs supported through local household spending

With $2.5 billion in federal research funds now at risk, the potential economic fallout includes:

• ~15,500 jobs lost
  
• $2.89 billion decline in GDP
  

These figures highlight how deeply integrated research dollars are in Boston’s broader economic fabric—from lab technicians and hospital staff to janitorial services and local diners.

International Students: More Than Tuition

Harvard enrolls more than 6,000 international students annually. Beyond the classroom, these students are essential contributors to the local economy.

Assuming each student spends roughly $3,000 per month, their combined presence supports:

• ~1,125 jobs in Greater Boston
• $180 million in local GDP
  

Restrictions on new international student enrollment threaten not just cultural and academic diversity, but also a reliable source of economic activity for housing, transportation, retail, and services.

What Comes Next?

Harvard may attempt to blunt these effects through private fundraising, internal reallocations, or downsizing. But even with mitigation efforts, the economic impact of these federal actions will be felt far beyond campus walls.

Boston’s knowledge economy—anchored by education, research, and healthcare—is at risk of contraction. The potential losses outlined here signal broader consequences not just for Harvard, but for the region’s workforce, innovation ecosystem, and long-term economic resilience.

Interested in quantifying the economic contributions of your own institution or region?

Explore how IMPLAN can help you model complex policy changes, funding shifts, and workforce impacts with precision.