In the wake of the US foreign aid freeze, the International Rescue Committee (IRC), one of the world’s oldest and leading humanitarian organizations, is facing a crisis of cutting thousands of staff.
“We have had to take immediate and significant cost-cutting measures, including laying off and furloughing thousands of IRC personnel around the world,” the IRC said in a statement.
The International Rescue Committee responds to the world’s worst humanitarian crises, including the conflicts in Ukraine and Afghanistan. It helps restore health, safety, education, economic well-being, and power to people devastated by conflict and disaster; the Committee is proud to fight for a world where women and girls have an equal chance to succeed.
The organization spoke of “the dual impact” of the freeze on most foreign assistance programs and the difficulty accessing funds disbursed through the US government’s payment system. An IRC statement said that, like many peer humanitarian agencies, IRC is responding to the impacts on their clients of disruptions to US foreign assistance funding for critical programs.
CEO David Miliband announced the first round of several hundred furloughs (unpaid leave) and imminent layoffs in a separate letter to staff last week.
“As much as we would like to believe there will be some relief of the financial pressure on our organization and that our programs will be able to resume, the reality is that there will assuredly be a significant reduction of [US government] support for our programs this fiscal year, impacting services and staffing,” Miliband wrote.
Miliband’s letter said the IRC’s leadership board cancelled staff pay raises and will take a 20% pay cut. According to tax filings for 2022, Miliband’s salary, which is about $1.2 million, including benefits, is one of the highest in the humanitarian sector; the IRC has previously said it has more than 17,000 global staff.
The International Rescue Committee’s financial struggles were further complicated by President Trump’s executive order on foreign aid, signed on his first day in office. This order halted HIV funding for Nigeria and other developing countries, froze Catholic charities’ funding amid an immigration crackdown, and left USAID’s future in limbo.
The International Rescue Committee: Critical programs halted
Layoffs have affected many international NGOs and aid organizations, including the Danish Refugee Council, Mercy Corps, the Norwegian Refugee Council, Catholic Relief Services (CRS), and FHI 360. Local aid organizations, from community groups to national NGOs, have also suffered a severe blow—most have minimal reserves and fewer donors.Â
NEAR, a network of Global South civil society organizations, says 83% of its members have paused programs, affecting millions, while staff layoffs are widespread. Most of the humanitarian sector’s workforce is local staff, often members of the communities they help.
The aid freeze has pushed organizations to abruptly suspend programs, leaving millions of people who use US-funded aid with little warning or time to find alternatives. Some examples of the impacts, according to the NGO network, are HIV-positive children dropping out of anti-retroviral (ARV) treatment programs and feeding centers for malnourished people, and water and sanitation programs have shut down.
The funding crisis spotlights the sector’s deep dependence on a small group of mainly Western donors, including the United States. Miliband’s letter said the US government contributed about 42%, or $650 million, of the IRC’s original 2025 budget.
According to financial statements, Save the Children received 54% of its operating revenue from US government grants and contracts in 2023. Staff there said that internal announcements on cuts are looming.
Similarly, US funding provided 37% support for CARE,35% for CRS, and 41% for Mercy Corps. Their dependence is passed along to subcontracted frontline local organizations.
Reckoning moment for the humanitarian sector
The agitation at the International Rescue Committee (IRC) and elsewhere may be a pivot point for the sector. It has grown rapidly over the last decade to meet rising needs and donor funding but has mostly not planned for the day when the financial well runs dry.
The New York City-based IRC, first founded in 1933 to help people fleeing Nazi Germany, saw its operating revenue jump from about $560 million in 2014 to $1.36 billion in 2023, mainly mirroring donor funding increases through the COVID-19 pandemic. In the 1950s and 1960s, the organization expanded its operations to include the relief and resettlement of refugees from Eastern Europe, the Soviet Union, Vietnam, and Cuba.Â
Today, it works in 40 crisis-affected countries worldwide, from Gaza to Sudan, Afghanistan, and the Democratic Republic of Congo. It was already weathering the financial crisis and previous staff cuts, which were driven by poor budgeting and forecasting practices, rising costs, and lower-than-expected revenue.
Critics say NGOs like the IRC have prioritized expansion over sustainability, relying on temporary pandemic funding. Even at the start of its current financial year, and with other organizations reducing expenses and undergoing sweeping reforms months earlier, the IRC was forecasting “sustained annual income” of $1.5 billion a year.
Like the rest of the humanitarian world and the wider aid sector, the IRC is reducing its expectations. In his email, Miliband told staff that there is a clear path through this period and that the IRC will remain a vital resource for tens of millions of clients, smaller than five years before but double the size of 10 years ago; he apologised for the price of getting there.
As organizations brace for more financial uncertainty, one thing remains clear: the people who rely on these life-saving programs will bear the brunt of these reforms.