Overdue Student Loans Reach Record as U.S. Graduates Seek JobsJohn Hechinger
Overdue student loans reached an all-time high as students struggle to find work after college, according to a government report renewing alarms about the rising burden of higher-education debt.
Eleven percent of student loans were seriously delinquent -- at least 90 days past due -- in the third quarter of 2012, compared with 6 percent in the first quarter of 2003, according to the report by the U.S. Education Department. Almost 30 percent of 20- to 24-year-olds aren’t employed or in school, the study found.
The research is being released amid concern in Congress and President Barack Obama’s administration about rising college costs and $1 trillion in outstanding student loans, the largest category of consumer debt besides mortgages. Borrowers say the burden is affecting their choice of jobs and their ability to buy homes and get married.
“Today’s economy puts young graduates in a difficult position,” Jack Buckley, commissioner of the National Center for Education Statistics, which published the report, 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.”
Still, college graduates have an edge in the job market, showing the need for higher education, Buckley said. The employment rate for young adults who are college graduates is 87 percent, compared with 64 percent for those with only a high-school diploma, the report found.