Average debt up again for new college grads

Oct 18, 3:49 AM EDT

Average debt up again for new college grads

By JUSTIN POPE
AP Education Writer

It's the latest snapshot of the growing burden of student debt and it's another discouraging one: Two-thirds of the national college class of 2011 finished school with loan debt, and those who borrowed walked off the graduation stage owing on average $26,600 - up about 5 percent from the class before.

The latest figures are calculated in a report out Thursday by the California-based Institute for College Access and Success (TICAS) and likely underestimate the problem in some ways because they don't include most graduates of for-profit colleges, who typically borrow more than their counterparts elsewhere.

Still, while 2011 college graduates faced an unemployment rate of 8.8 percent in 2011, even those with debt remained generally better off than those without a degree. The report emphasized research showing that the economic returns on college degrees remain, in general, strong. It noted the unemployment rate for those with only a high school credential last year was 19.1 percent.

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The issue has come up on the presidential campaign trail, though the candidates' specific plans haven't become a major issue. President Barack Obama has touted his record of ending $60 billion in subsidies to private lenders, directing the savings to student aid and implementing an income-based repayment plan that caps federal student loan payments at 15 percent of income and forgives repayment after 25 years.

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In Tuesday night's second presidential debate, Romney repeated an assertion he'd made previously that "50 percent of kids coming out of college (are) not able to get work." That is not accurate, though twice earlier in the debate he made an important qualification, indicating he was referring to graduates who couldn't get "college-level jobs." Figures analyzed by Northeastern University's Center for Labor Market studies last spring did find 53.6 percent of bachelor's degree holders under age 25 were either unemployed or working in positions that don't fully use their skills or knowledge.

The latest TICAS report also cites studies that found more than one-third of recent graduates were in positions that did not require a degree, depressing wages, though other government figures cited by Georgetown University's Center on Education and the Workforce put the so-called "underemployment" rate for young college grads much lower - at around 10 percent.