Despite Record $9B Budget, Gates Foundation Plans 500 Layoffs

Bill Gates's The Bill & Melinda Gates Foundation has officially confirmed that it will cut 500 jobs in the next five years. Interestingly, the foundation plans to spend $9 billion annually (the highest level of spending to date). The foundation reached this decision after deciding to shut down completely in 2045. The administration is allowed to use about 14% of the total budget. And without the job cuts, this number is expected to reach 18% by the end of the decade. So, the organisation wants to cut costs. So, how many will lose their jobs? Learn more. 

How Many Will Lose Jobs at the Bill & Melinda Gates Foundation?

The foundation right now has about 2,375 employees. In the next few years (by 2030), this number will decline to 1,875. That’s a reduction of more than 20% of the workforce. According to the foundation, the job cuts will happen gradually, and staffing plans will be reviewed every year. However, it also clarified that it will still hire people with critical skills when absolutely necessary. 

Why Is the Bill & Melinda Gates Foundation Laying off Now?

The organisation has decided to shut down entirely in 2045. And before the shutdown happens, it wants to use the funds as aggressively and effectively as possible. It's now committed to spending nearly $9 billion every year. Bill Gates says that it will have an additional $200 billion in total spending over the next 20 years. 

People are confused about why the budget is up, and the workforce is down. It's clear now that it wants to reduce internal costs, such as salaries, office space, and administration. According to the organisation, it wants to redirect more money directly into its programmes, such as health, education, and women’s welfare.

“Ensuring as much of every dollar as possible flows toward impact is critical to achieving our ambitious goals to save and improve millions more lives over the next 20 years,” said Mark Suzman, chief executive of the Gates Foundation. (According to the foundation’s release reported by Reuters).

Operating Costs of the Bill & Melinda Gates Foundation?

Recently, the foundation's board approved a rule limiting spending on operating the organisation to 14% of the total budget. This number is roughly $1.25 billion, based on current estimates. And without the job cuts, the number is expected to go up by 18% (by the end of the decade). Therefore, the layoffs are necessary to stop internal costs from growing too much.

Where Will the Bill’s Money Go Instead?

This restructuring is one of the biggest in the foundation's history. The foundation is trying to achieve a healthy balance among ambitious charitable goals, tight cost control, and employee morale. The board wants to protect and fund key programmes, including:

• Global health
• Women’s health
• Education
• Artificial intelligence initiatives in US education

Final Thoughts...

The confusion began with the budget increase and the announcement of layoffs. The foundation has clarified that it intends to increase spending on health, education, and women's welfare. Hence, the layoffs are inevitable.  

How the Gates Foundation will be affected by the Divorce

Bill and Melinda gates recently announced their divorce but Will the gates foundation be affected by it or not?

StartupTalky- Business News, Insights and StoriesAlan Joseph