Tag Archives: Graduate
To get educated these days, most students have to go into debt.
And debilitating debt, experts say, could trigger a financial meltdown akin to the mortgage crisis if students don’t repay their loans.
It could also make the millennials, aged 18 to 34, the first generation in America not to do better than their parents, a potential failure that has people questioning the morality of how we now pay for education:
“Is it ethical to saddle a 17-year-old who’s never had experience with credit with this amount of debt?” asked Barmak Nassirian, associate executive director of the American Association of Collegiate Registrars and Admissions Officers in Washington. “No counseling teaches the pain of repayment.”
And while students suffer, lenders flourish, Nassirian added: “What’s better than garnishing my wages and owning a piece of me for life?”
Nationally, the average student debt is about $25,000 per person, according to 2010 figures, the latest reported by the Institute for College Access & Success. That’s the highest level of student debt in American history, up nearly 43 percent since 1996, in today’s dollars.
Overall, U.S. student debt is more than $1 trillion. This includes loans for students who attended any type of postsecondary institution—whether they graduated or not, according to the newly formed federal Consumer Financial Protection Bureau. That total is more than all the outstanding charges on all the credit cards throughout the United States ($693 billion), or all U.S. auto loans ($730 billion).
Student loans can be dangerous for young people, who can’t declare bankruptcy and walk away from their obligations, the way people with credit-card or gambling debts can. Student debt can be garnished from wages and Social Security.
“It worries me,” said Mike Mychack, 24, of Philadelphia. He graduated this year with $50,000 in debt from Temple University and now works at the Bridesburg Boys & Girls Club in Philadelphia, making less than $20,000 a year. “I’ll never be able to pay the loan off at this rate.”
The bulk of students in America attend public colleges and universities, where state funding nationwide has been cut 2.8 percent in the past two years.
At the same time, experts on college financing point out, universities are continually spending money to improve their physical plants and to make their campuses more enticing to students.
Certain schools offer financial-aid packages without loans. But often, experts say, parents are expected to contribute, and they end up taking out loans.
Colleges are facing a shift in who pays their bills, concludes a recent study by the Delta Project, a nonprofit that studies college spending. Especially at public universities, the portion of costs covered by tuition is going up faster than overall spending.
These days, more students than ever—10 percent—graduate with high debt, defined as loans of $40,000 or more, up from 3 percent since 1996, according to the Project on Student Debt.
Among all students, African-Americans carry the most levels of high debt in the United States.
About 16 percent of African-American graduates owed more than $40,000 on loans in 2008, the latest year calculated. For whites, it was 10 percent; Hispanics, 8 percent; and Asians, 5 percent.
African-Americans are “disproportionately recruited by and enrolled in for-profit colleges, which cost more on average,” said Pauline Abernathy, vice president of Institute for College Access & Success.
“It’s very troubling that the lowest-income students have the highest levels of student debt,” she said.
A disproportionate share of African-Americans have low incomes and are the first in their families to attend college, Abernathy said. They’re less likely to know someone who has gone to college to stop them from enrolling at any school that pressures them to sign up.
The U.S. Department of Education has accused some for-profits of using exploitative tactics to enroll students.
With so much overwhelming student debt, defaulting on loans is increasing.
About 320,000 borrowers who started repaying their loans in 2009 defaulted by the end of 2010—81,000 more than the year before.
More than 50 percent of the increase is from students who attended for-profit colleges, which charge tuitions that in many cases are double those of other colleges.
Students who default often ruin their credit, finding themselves unable to buy homes or even to secure more student loans to try to finish school.
Things could get worse in July, when interest rates on federal student loans for low-income students are set to rise to 6.8 percent, from 3.4 percent. President Barack Obama is fighting the increase, while Republicans in the U.S. House of Representatives are supporting it.
Not all student debt is bad.
College, in fact, can be the best investment a person ever makes.
But when the class of 2012 graduates next month, its members will be entering a job market with steep competition.
“The problem isn’t necessarily the $25,000 debt,” said Paul Harrington, director of the Center for Labor Markets and Policy at Drexel University. “It’s having the debt and then making $10 an hour that’s overwhelming.”
Students must be more strategic in picking majors that will lead to jobs that can pay back their loans, experts say.
“It’s one thing to have a six-figure debt and be graduating from medical school,” noted Hurley of the American Association of State Colleges and Universities. “But $40,000 in debt for a social worker or public schoolteacher—that’s not good at all.”
Alfred Lubrano/The Philadelphia Inquirer
Meredith Ballard is an economics major at Colorado College. But when she began her senior year last fall, she started feeling she was spending more time traveling to job interviews than going to class.
“It got stressful,” said Ballard, 22, of Green Oaks, Ill. “I had to work on my thesis on top of having a very difficult class while trying to land a job.”
The employment market may be picking up, but graduating seniors like Ballard—who landed a job with a Chicago advertising agency and will start next month—have in many cases known nothing during their college careers but economic turbulence and high unemployment.
“Nowhere has the economic impact been as traumatic (as) for college seniors graduating in the last four years,” said Richard Berman, director of career services at Oberlin College.
To forestall entering the job market, many soon-to-be graduates are taking unpaid internships or social service work, going to graduate school, or even trying to start their own businesses.
Those who are searching for jobs are making it a higher priority than schoolwork. Gone is the luxury of taking it easy senior year.
There are some glimmers of hope. The unemployment rate for recent college graduates is 6.2 percent, lower than the overall rate and the lowest since the start of the recession. And employers surveyed by the National Association of Colleges and Employers said they planned to hire 10.2 percent more new graduates this year than last year.
Still, the odds for job-seekers in many fields remain long.
“This year’s seniors are landing more interviews, but I think it’s more a function of their tenacity” than an increase in the number of jobs available, said Lisa Kastor, director of career services at the College of Wooster in Ohio.
Jacob Meyers of Elyria, Ohio, for example, applied for 35 jobs and got three interviews, but no offers.
“I just don’t want to be floating around after college,” said Meyers, 22, who is job-huntinging while finishing requirements for his triple major in English, theater, and gender, sexuality and feminist studies at Oberlin. “There just seems to be this pressure from everywhere. Everyone is looking for a job. Even my mom is dead set on me finding one. She’s scared, too.”
At Washington and Lee University in Virginia, 15 students applied to meet on campus with a recruiter for an investment bank. Six got interviews. The bank has one position available.
“The employers are doing a lot more screening,” including remotely by Skype before even entertaining the idea of an in-person interview, said Beverly Lorig, director of career services at Washington and Lee. “There’s less willingness to consider a ‘maybe’ candidate.”
Meanwhile, students and their families have been subjected to unrelenting bad news from the job front.
“It bruises the psyche of your graduating class,” Lorig said. “There’s stress with seniors, and there’s stress with parents. It’s really important that we teach students to be resilient in these times. I fear that a lot of seniors withdraw after they get roughed up a bit with the rejections.”
Many students have reason to be worried. Those who took out loans for college are graduating with an average debt of more than $25,000—twice the 1996 figure—according to the U.S. Department of Education.
Some students say they are beginning their job searches a year before graduation, and they are networking more often with college alumni.
“Just because the front door to an organization is tighter, and therefore harder to open, doesn’t mean that there aren’t side doors into it,” Berman said. “One has to build networking opportunities through recent grads and alumni.”
For Lauren Martinez of Redmond, Wash., the time she took to job-hunt last semester paid off: The senior economics major at Macalester College in Minnesota found a job at a financial consulting firm in California.
But Martinez said the offer came at the expense of time and energy she could have applied toward schoolwork.
“My grades suffered at the beginning of the semester when I was spending so much time traveling to interviews, practicing interviewing and filling out applications,” Martinez said. “It was all so overwhelming.”
Still, she’s glad she has a job. “It’s definitely a relief to know that I’ll have a paycheck,” she said. “With that in mind, the rest of my senior year will be a lot easier.”
Meghan Farnsworth/The Hechinger Report
Creativity from the heart and a love for words paid off for a Linfield College graduate.
He was awarded with the 2011 Whiting Writer’s Award on Oct. 25 at a ceremony in New York.
The award, established in 1985, is a $50,000 prize that is given annually to 10 emerging young writers in all genres.
Shane McCrae, class of ’02, has been writing poetry since he was a teenager.
“I started writing poetry when I was 15, and I’ve been doing it ever since. I really got into it during college,” he said.
McCrae studied creative writing at Linfield. He has also studied at Harvard Law School and is currently working on a Ph.D in English at the University of Iowa.
Writing poetry is something that comes naturally to McCrae. He writes about things that have importance to him and his life. He writes about experiences and observations.
Some of his poems have been about his family, his personal struggles and his own racial identity.
“In a general sense, they’re usually about things that have happened in my life or maybe some of them are about religious issues or have to do with history,” he said.
His work is described as lyrical, personal and autobiographical.
Previous winners of this award include authors, such as Kim Edwards, Mary Karr, Michael Cunningham and Tobias Wolff. They were all emerging writers when they received the award, and are all now bestselling authors.
McCrae hopes to be as successful, but still enjoy writing.
“Success, I guess, is kind of hard to define. For me, I can be successful if my poems are reaching out to people or if people are finding them helpful. I guess it would be nice if I could find a job I love through my work. The kind of success I want is to work with other people and still love it,” McCrae said.
McCrae has published multiple works, including a full length collection that came out earlier this year called “Mule.”
His poems have appeared in publications like “The Best American Poetry 2010,” “The American Poetry Review” and other journals.
He describes writing as a kind of self-reflection.
“What I love about writing is probably just the act of writing, itself,” McCrae said. “You feel like all your senses are working together to create something new. It’s a very personal experience, and it’s a good feeling.”
The award will further propel his success and make him more well-known.
McCrae is looking for a teaching job and plans to continue writing.
Kelsey Sutton/Copy chief
Kelsey Sutton can be reached at email@example.com.