It’s the latest snapshot of the growing burden of student debt and it’s
another discouraging one: Two-thirds of the national college class of 2011
finished school with loan debt, and those who borrowed walked off the
graduation stage owing on average $26,600 — up about 5 percent from the
The latest figures are calculated in a report out Thursday by the
California-based Institute for College Access and Success (TICAS) and likely
underestimate the problem in some ways because they don’t include most
graduates of for-profit colleges, who typically borrow more than their
Still, while 2011 college graduates faced an unemployment rate of 8.8
percent in 2011, even those with debt remained generally better off than
those without a degree. The report emphasized research showing that the
economic returns on college degrees remain, in general, strong. It noted the
unemployment rate for those with only a high school credential last year was
“In these tough times, a college degree is still your best bet for getting a
job and decent pay,” said TICAS President Lauren Asher. “But, as debt levels
rise, fear of loans can prevent students from getting the education they
need to succeed. Students and parents need to know that, even at similar
looking schools, debt levels can be wildly different. And, if they do need
to borrow to get through school, federal student loans, with options like
income-based repayment, are the safest way to go.”
The latest figures come at a time of increasing alarm about the sheer scope
of student debt nationally, which by some measures has surpassed $1
trillion. Recent government figures show nearly 10 percent of borrowers of
federal student loans in the most recently measured cohort had already
defaulted within two years of starting repayment.
The issue has come up on the presidential campaign trail, though the
candidates’ specific plans haven’t become a major issue. President Barack
Obama has touted his record of ending $60 billion in subsidies to private
lenders, directing the savings to student aid and implementing an
income-based repayment plan that caps federal student loan payments at 15
percent of income and forgives repayment after 25 years.
Former Massachusetts Gov. Mitt Romney, his Republican challenger, argues the
flood of federal student aid spending unleashed in recent years has led
colleges to raise tuition prices. He wants to return to a system in which
the government supports private lenders, arguing it’s more cost-effective,
and his campaign has called the income-based repayment program flawed.
In Tuesday night’s second presidential debate, Romney repeated an assertion
he’d made previously that “50 percent of kids coming out of college (are)
not able to get work.” That is not accurate, though twice earlier in the
debate he made an important qualification, indicating he was referring to
graduates who couldn’t get “college-level jobs.” Figures analyzed by
Northeastern University’s Center for Labor Market studies last spring did
find 53.6 percent of bachelor’s degree holders under age 25 were either
unemployed or working in positions that don’t fully use their skills or
The latest TICAS report also cites studies that found more than one-third of
recent graduates were in positions that did not require a degree, depressing
wages, though other government figures cited by Georgetown University’s
Center on Education and the Workforce put the so-called “underemployment”
rate for young college grads much lower — at around 10 percent.
As for those who have no job at all, according to Georgetown the latest
monthly unemployment figure for college graduates under age 24 is 10.5
percent (the figure typically jumps each spring as a new class graduates and
declines over the course of the year; last March it was 5.4 percent).
“Increasing student debt in a weak economy can be a knock-out blow to many
considering college,” said Rich Williams, higher education advocate with
U.S. Public Interest Research Group, which advocates for students. “As our
economy is recovering, lawmakers must send every signal that college is a
good investment. “
Among other finding in the TICAS report:
—Private (non-federal) student loans, which generally have weaker borrower
protections but have been diminishing as a source of student borrowing,
accounted for about one-fifth of the debt owed by the Class of 2011.
—Debt levels vary widely by state, ranging from $17,250 in Utah to $32,450
in New Hampshire.
—Debt at individual schools ranged from $3,000 to $55,250 though not all
schools report that data.
the percentage of graduates with debt ranged from 12 percent to 100 percent.
At 64 schools, more than 90 percent of student graduated with debt.