A new report from the Institute for College Access and Success indicates that although 2014 college graduates were only slightly more likely to have student loan debt than students who graduated in 2004, the average student loan debt has increased by 56% over that same time period.
According to the 10th annual report from The Institute for College Access and Success, or TICAS, the average amount of debt students left college with at graduation has increased 56% over the last 10 years from $18,550 in 2004 to $28,950 in 2014. At the same time, the percentage of students who graduate college with debt has seen little change, from 65% in 2004 to 69% in 2014.
This is the first time that the TICAS report looked at the change in debt that graduates end up with. Findings indicate that across the nation, the average debt for undergraduate degree holders increased at more than twice the rate of inflation between 2004 and 2014. Some states, including Delaware, Hawaii, Illinois, Kentucky, and Maryland, saw an even higher increase.
The average debt of 2014 graduates, $28,950, was found to be 2% higher than that seen in 2013, writes Lauren Camera for US News.
Of last year’s debt, 17% was found to be from private student loans rather than federal aid, which usually is more flexible in repayment options.
The Obama administration has been making a push for easier access to higher education information, including costs and estimated earnings after graduation, for potential students. Efforts have also been made to make it easier for students to access federal financial aid.
“Student debt has rightly become a major policy issue,” TICAS President Lauren Asher said. “Students and families need better information and better policies to make college more affordable and debt less burdensome.”
Despite the rise in tuition and student loans, the report still stresses the importance of obtaining a postsecondary degree, suggesting that doing so will offer more job opportunities and a higher salary.
“For students who don’t graduate, loans are much harder to repay. Even a small amount of debt can be burdensome if you have limited job options,” said Debbie Cochrane, a report co-author and research director at TICAS.
Data from the report lists the unemployment rate at 7.2% for young college graduates in 2014. Although that is a decrease from recent years, the report maintains that it is still higher than it was pre-recession, reports Ashlee Kieler for The Consumerist.
However, report co-author Matthew Reed reminds readers that because colleges are not required to report debt levels for their graduates, the data is incomplete. Of the colleges that did report, underestimates may have occurred because transfer students are not included and private student loans may not be taken into account.