College student debt has a reached an all time, according to an Associated Press article last week on a Pew Research Center report. The new research shows a lack of jobs for recent graduates and rising tuition costs are contributing to the record high student debt.
One interesting aspect of the report: the two groups most affected by high debt are the most well-off and the least well-off:
The increase was driven by higher tuition costs as well as rising college enrollment during the economic downturn. The biggest jumps occurred in households at the two extremes of the income distribution. More well-off families are digging deeper into their pockets to pay for costly private colleges, while lower-income people in search of higher-wage jobs are enrolling in community colleges, public universities and other schools as a way to boost their resumes.
Make no mistake, the lowest earners are shouldering the greatest burden when it comes to student debt:
As a share of household income, the debt burden was the greatest for the poorest 20 percent of households, or those making less than $21,044. In all, 40 percent of U.S. households headed by someone younger than age 35 owed college debt, the highest share of any age group.
The new Pew report reflects a trend that the Keystone Research Center first reported on a little over a year ago in a report about the American jobs crisis and how it impacts Pennsylvania's middle class:
Stable middle-class jobs with benefits are increasingly hard to find, meaning two earners in a family can work hard throughout their lives and nevertheless be left in the lurch when something goes wrong or when it comes time for retirement. Earnings are down over roughly the last decade, and unemployment and slow job growth limit the likelihood of change in this pattern. A college degree has grown increasingly necessary to earn higher wages. Yet these degrees are increasingly expensive, leaving graduates mired in record debt.