The NCES reports that the total student loan debt, which is the only form of loan debt that has increased since the recession, in 2012 stands at nearly $1 trillion.
In the federal government’s annual status report on U.S. education outcomes, researchers affiliated with the National Center for Education Statistics (NCES) have put a special emphasis on higher education and employment and on the growth of federal student financial aid.
The Condition of Education 2013, which was released today by NCES and includes both K-12 and higher education outcomes, documents that nearly 30 percent of 20- to 24-year-olds are neither employed nor attend school. Employment rates are higher among young adults with at least a bachelor’s degree in comparison to their peers. For college graduates, the employment rate is 87 percent compared to 48 percent for those who did not finish high school.
Over the last decade, the federal government has increased financial aid to students, amounting to $146 billion in 2011. The report says that grant aid, mostly in the form of Pell grants, nearly quadrupled between 2000 and 2011. And disbursed student loans have grown by 150 percent, reaching $109 billion in 2011, according to the report. The growing demand for student loans, along with lending policy changes, has resulted in more than $500 billion of student loans owned by the federal government.
Total student loan debt, which is the only form of loan debt that has increased since the recession, in 2012 stands at nearly $1 trillion and delinquency on student loan debt has been increasing, according to the NCES.
“Today’s economy puts young graduates in a difficult position,” NCES Commissioner Jack Buckley said in a statement. “A college diploma no longer guarantees a direct pathway to the middle class, making it harder to justify the expense of a degree. Yet, when we look at the low employment rates for those who have only completed high school or less, we see how hard it is to get a good job without some type of higher education.”
Thomas D. Snyder, the NCES program manager for annual reports, said the special emphasis on higher education financing and employment represents an effort by the NCES to place education in a larger context than is typically done in The Condition of Education report. In addition to higher education financing and the young adult employment rates, this year’s report examines academic “redshirting” of kindergartners, or purposefully delaying a child’s entry into kindergarten, and rural education in the U.S.
“The student loan debt is the second largest type of debt held by consumers, second only to home mortgages. So, I think that the student loan industry has really grown over time and represents a growing percentage of the debt that consumers hold,” Snyder says.
“It has a specific relevance to higher education obviously, but also it really is something that can be considered from a larger perspective as well. And that’s something that’s a little bit new for us,” he explains.
In the past, the NCES has “tended to look at higher education more narrowly rather than on how it affects the economy as a whole,” according to Snyder.
“That was what we’re trying to do, [which] is to take this broader perspective in how the student loan industry fits in” to what is happening in the national economy, he notes.
With respect to employment, the report shows that college graduates have higher employment rates than those who have less than a bachelor’s degree.
“This pattern was consistently observed for young adults, 25- to 34-year-olds, and 25- to 64-year-olds. In 2012, for example, the employment rate for young adults was 86 percent for those with at least a bachelor’s degree, compared with 74 percent for those whose educational attainment was some college, 64 percent for high school completers, and 48 percent for those who did not complete high school,” the report states.
Snyder notes, however, that the report reveals that, from 1990 to 2012, there has been employment rate “slippage” among college graduates with the recent Great Recession being a significant factor. “During the most recent economic recession, employment rates generally declined across age groups and educational attainment levels,” according to the report.
Snyder says the report is written annually to inform policymakers and the public about the progress of education in the U.S.
Congress has mandated that the NCES produce The Condition of Education. In all, this year’s report showcases 42 indicators of important developments in U.S. education. The selected indicators include those describing population characteristics and participation in elementary, secondary education and postsecondary education.
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