Try digitalPLUS for 10 days for only $0.99

Op-Eds

News Opinion Op-Eds

Students trapped by high debt, low wages

Based on estimates by the Federal Reserve, for the first time in U.S. history, student-loan debt ($867 billion) has surpassed credit card debt ($704 billion). These debt levels have real implications for productivity and lifetime earnings for this current generation of graduates. Much has been written about college students dealing with rising tuition, but there's been much less examination of how substantial student-loan debt, coupled with a slumping economy, affects new graduates.

According to a June report by Drexel University's Center for Labor Markets and Policy, even as the overall job market has rebounded in the last two years, employment prospects for college graduates have declined. In an economic environment where young adults under 25 have much higher unemployment rates than the national average, and 85 percent of recent college graduates said they may have to move back in with their parents, seeking higher education is a riskier financial investment than in years past.

For too many college graduates, that investment has not paid off. A 2011 Pew Research Poll found: "A majority of Americans (57 percent) say the higher education system in the United States fails to provide students with good value for the money they and their families spend. An even larger majority — 75 percent — says college is too expensive for most Americans to afford."

President Barack Obama has set an admirable goal for the U.S. to have the highest portion of college graduates (it is currently 16th) in the world by 2020. While I agree with his aspiration, should U.S. students have to go into significant debt to achieve this goal? Higher education institutions, states and the federal government must find ways to minimize the financial risks of going to college or graduate school.

Based on estimates by the American Psychological Association's 2009 Doctorate Employment Survey, graduates with a Psy.D. in clinical psychology reported a median debt level of $120,000, up from $70,000 in 1999. While debt levels have climbed, the median income range for graduates actually decreased ($50,000-$70,000) from what was reported in 2007 ($52,000-$72,000).

The sad reality is that while student-loan debt for current graduate students is expected to soar above the $120,000 mark, wages are expected to remain stagnant. Unfortunately, students rarely consider these factors when making important decision about their careers. We have been trained to believe that higher education is always worth the money, and historically it has been — but we live in a much different world now.

Recent graduates are not only struggling with massive student-loan debt, but they are also facing unemployment and underemployment. A recent CNBC study found that college graduates are, in aggregate, more likely to be employed as waiters, waitresses, bartenders and food-service helpers than as engineers, physicists, chemists and mathematicians combined (100,000 versus 90,000). There were more graduates working in low-level, office-related jobs such as receptionist or payroll clerk than in all computer and professional jobs combined (163,000 versus 100,000). More graduates were employed as cashiers, retail clerks and customer representatives than engineers (125,000 versus 80,000).

With this grim reality, it is no wonder 57 percent of Americans believe the U.S. educational system fails to provide a good value for the money spent. Not many students went to college with the hopes of becoming a waiter.

What message does this send to future students about higher education? What does it say about our prospects of becoming the most educated nation? It used to be that higher education was a ticket to financial security, and given the disappearance of high-paying blue-collar jobs in recent decades, a degree is increasingly a requirement to enter the upper middle class. But it is also much more of a gamble.

As the U.S. tries to reclaim its No. 1, position in the world, students and their families must ask themselves: Do the benefits of higher education outweigh the costs? With student debt levels reaching uncharted territory and a shortage of jobs, the answer to this question may no longer be an obvious yes.

Titus Hamlett, a Baltimore City resident and University of Maryland, College Park graduate, is a clinical psychology Ph.D. student at the California School of Professional Psychology. He served as witness/panelist for a congressional hearing on student loan debt. His email is thamlett@alliant.edu.

Copyright © 2015, The Baltimore Sun
Related Content
  • Beware the costly liberal arts trap

    A growing number of young people are confronting a high-debt, low-wage trap that has more college grads working in the food service industry than as engineers ("Students trapped by high debt, low wages," Nov. 9). But how many engineering graduates didn't find jobs?

  • Could a state property tax cap stimulate Baltimore's economy?

    Could a state property tax cap stimulate Baltimore's economy?

    When Gov. Larry Hogan announced his rejection of the Red Line, an east-west rail transit line in Baltimore City, he seemed to derail the high hopes of Mayor Stephanie Rawlings-Blake and many other supporters of the $2.9 billion project. "He canceled a project," lamented the mayor, "that would have...

  • Urban America should give up on the Democrats

    Urban America should give up on the Democrats

    In my lifetime (I was born in 1950), the Democrats have had an extraordinary opportunity to run some of America's largest cities and apply their brand of liberal policies to the social and economic problems that have plagued them. Look at the history in just eight of these cities, according to...

  • Inequality of opportunity in the U.S.A.

    Inequality of opportunity in the U.S.A.

    We like to tell ourselves stories about the virtues of America, particularly as Independence Day rolls around each year. There is, perhaps, no better example than the story we tell our children that no matter your race, gender or wealth, in America you can become anything you want to be. This particular...

  • The burdens of being black

    The burdens of being black

    I was born human more than a half century ago but also birthed with the burden of being black. I discovered racial discrimination early in life. I grew up among the black poor in Hartford, where a pattern of housing segregation prevailed. One city, but separated North end and South end on the basis...

  • Partnerships improve health care in Maryland

    Partnerships improve health care in Maryland

    For decades, as health care costs continued to spiral upward and patients were stymied by an increasingly fragmented health care system, policy leaders, politicians and front-line caregivers strained to find a better way to care for people.

  • The deep roots of housing bias

    The deep roots of housing bias

    The Supreme Court's ruling last week that factors other than intentional racial discrimination can be considered in determining whether policies promulgated by government or private entities violate the 1968 Fair Housing Act is simply a reminder that the century-long struggle to end such practices...

  • Political polarization leads to bad legislation

    Political polarization leads to bad legislation

    The Supreme Court's decision in King v. Burwell, permitting 6.4 million Americans to continue receiving subsidies to buy health insurance on the federal insurance exchange, elated liberals and enraged the right. Conservatives have already begun decrying the "traitors" who, though appointed by Republican...

Comments
Loading

79°