A report released this week by the Federal Reserve Bank of New York highlights the drag that student loans have placed on the economy and recalls the notion that this debt burden may be creating a generation of wage slavery.
Forty percent of the people under 30 had outstanding student loans, and the average outstanding debt is $23,300. About 10 percent of borrowers owe more than $54,000 and 3 percent owe more than $100,000.
After adjusting for the estimated number of individuals still in school or who otherwise qualified for payment deferral, the report found that 27% of student borrowers are delinquent in their payments.
It’s probably not going to get better any time soon.
In sum, student loan debt is not just a concern for the young. Parents and the federal government shoulder a substantial part of the postsecondary education bill. Moreover, the student loan delinquency picture is not fully captured in the broad statistics since a significant proportion of borrowers and balances are not yet in the repayment cycle. The implications of this last fact for future changes in the student loan delinquency rate are a very important area of research.