The steadily increasing costs of college tuition in the past ten years have resulted in unprecedented levels of student debt for many college students. For every ten students graduating in the class of 2012 seven of them had student loan debt nearing $30,000. In 2012, we saw the number of students graduating with loans rise from 68% percent to 71% because colleges are not required to report debt levels for their graduates annually; these averages are gathered from surveys taken from nearly half of public universities, who voluntarily reported their student’s levels of debt upon graduation. Data from voluntary estimates revealed that debt levels varied widely depending on state. This data showed graduating seniors reporting anywhere from $18,000 to $33,000 of debt upon graduation. Additionally, a number of Northeastern and Midwestern states that had debt levels were reported to be well in excess of the national average for public universities, while low debt states were concentrated primarily in the West and the South. Compared to public universities, 88% of students at for-profit universities graduated with debt averaging $40,000.
While the levels of the debt for students are rising, so too is the cost of college tuition. Between the years of 1978 and 2011 the average cost of college tuition has risen at a rate of nearly 7.45% per year for the past three decades. These increases are significantly greater than increases in average inflation (3.8%), housing prices (4.3%) and increases in the cost of medical care (5.8%). Another problem facing college students is the absolute lack of consumer protections, which ensures that lenders are incentivized to lend students the largest loan amount possible. All of these factors have contributed to a scenario in which college graduates are expected to begin their professional careers with few job prospects and under enormous financial strain. There is little indication that this trend will be abated any time in the near future.