For Immediate Release
Communities of Color and Student Loan Debt during the Great Recession
WASHINGTON - Today the Center for American Progress released an analysis on the latest data from a survey conducted from the Federal reserve of households in 2007 and 2009 showing there is even less economic security today for those who went deeper into debt to pay for their education in those years, particularly communities of color.
The largest increase in the median education debt amount—$5,715—occurred among African-American households. Households of other races and households with a high school degree also saw comparatively large increases in education debt. That is, households that disproportionately struggled due to higher unemployment, lower wages, and fewer benefits than their counterparts, such as African Americans, saw faster debt increases than their counterparts. It is possible that struggling groups were more willing to go deeper into debt than their counterparts in an effort to regain some economic security during the difficult labor market during and after the Great Recession.
The summary data show that rising education loans put many student loan borrowers, especially communities of color, into an economic bind, making it more difficult to climb out of a deepening hole. Allowing interest rates on new student loans to climb without countervailing measures will thus put additional pressures on an increasingly struggling middle class that continues to need to borrow to attend ever more costly colleges and universities.
To read the full analysis, click here.
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