Is there a looming student debt crisis at our nation’s for-profit colleges and trade schools? The latest data from the U.S. Department of Education’s National Center for Education Statistics (NCES) certainly seems to suggest so.
According to an analysis of this data by the College Board, 60 percent of bachelor’s degree recipients at for-profit colleges graduate with $30,000 or more of student loan debt. That’s one-and-a-half times more than graduates at higher-cost private colleges and three times more than those at public universities and state colleges. At the same time, one in five students who earn associate degrees at proprietary schools graduate with a debt load of at least $30,000. That’s four times more than associate degree recipients at community colleges. [The average annual salary of associate degree recipients is around $38,000.]
More disturbing is the extent to which proprietary school students are being asked to rely on high-cost private student loan debt to help cover their costs. In 2007-08, 43 percent of students at for-profit colleges borrowed private student loans, compared to 28 percent at private colleges, 15 percent at public four-year colleges, and 7 percent at community colleges. As we reported in April, the proportion of private loan borrowers at proprietary institutions has skyrocketed over the last five years. In 2003-04, about 15 percent of students at these schools took out private loans.
Definitely read the whole thing; there’s a lot of important stuff here.