Tuesday, June 4, 2013
Students are graduating from college with more debt, but degrees still pay off, according to a new report.
Student debt amounts are on the rise across the country. A new report from the Public Policy Institute of California points to the lowest community college fees in the country and relatively strong state financial aid as two factors keeping debt loads lower for California students.
In California, a higher proportion of students attend public colleges and fewer take out loans compared to the national average. The report shows that those who do borrow finish college with a median debt load of $15,000, compared to $17,100 nationally.
The higher wages and more stable employment that came with a college degree outweighed the burden of repaying loans for most California students, according to Hans Johnson, a research fellow with the institute. Borrowing to attend for-profit private colleges may not pay off though.
“It is a concern," Johnson said, "that students who are the most vulnerable in terms of not being able to succeed in college and therefore having the worst labor market outcomes often end up at colleges that have some of the highest loan amounts."
Johnson said even students in the lowest earning majors who had relatively high debt loads did better in the long-term than those who had only a high school degree.