The recent financial crisis has manifested itself in new restrictions on hiring and salaries at the Harvard Kennedy School, Dean David T. Ellwood ’75 announced in a memorandum sent to the school’s faculty on Wednesday.

According to the memo, Harvard Kennedy School faculty and staff hiring will be “slowed or stopped,” except in cases of “extremely high strategic priority.” Hiring will now be contingent on finding funding for the positions, be it from outside sources or unpaid leaves, such as those departing the school to work for the Obama administration.

The Kennedy School also plans to reduce the number of visitors and adjunct lecturers and ask some faculty members to postpone paid leaves they had scheduled for next year as part of its attempts to reduce faculty spending.

In addition to the hiring changes, there will be no salary increases for Kennedy School faculty members this year.

The only exceptions will be for those promoted and for members of the Harvard Union of Technical and Clerical Workers.

As a result of the financial crisis, Ellwood said, the school anticipates a sharp rise in domestic applications for next year, citing an 80 percent increase in applications for the Kennedy School’s joint degree program with the Harvard Business School as an early indication.

Ellwood, who has made financial aid a priority during his time as Kennedy School dean, pledged that the amount the school allocates for student financial aid will be at least as much as last year.According to Ellwood, Kennedy School’s primary revenue sources are endowment payouts, degree program and executive education tuitions, gifts, and sponsored research, all of which will probably be negatively affected by the financial crisis.

“Overall, all of our major sources of income are likely to be flat or falling,” Ellwood wrote in the memo.

He also asked the Kennedy School’s departments to prepare two additional budgets for 2010—one with a 5 percent reduction in expenses and one with a 10 percent reduction—in addition to their planned budgets.

The Kennedy School also plans to temporarily postpone a few of its current projects, such as the renovation of the Wiener Auditorium.

“We will be taking a hard look at how we could reduce expenses even more dramatically if the situation worsens,” Ellwood wrote, adding that he hopes the Kennedy School will avoid having to lay off any of its employees.