Pennsylvania graduates’ loan debt remains near top
Pennsylvania college graduates continued to bear some of the highest average student debt levels in the nation last year.
A new report by the Project on Student Debt found that 71 percent of 2013 Pennsylvania college graduates carried debt averaging $32,528. That is about $4,000 more than the nationwide average of $28,400.
The figures include both federal and private loans, but may be lower than the real debt because they exclude Parent Plus Loans, loans that parents take out to help pay for college costs.
Experts say the figures reflect the high cost of a college education in a state where subsidies for higher education are low and its largest public universities — the University of Pittsburgh and Penn State — typically rank first and second on the list of the most costly public universities in the nation.
“Pennsylvania stands out in that public college graduates there have about the same amount of debt and are more likely to have debt than private college graduates. That’s the opposite of what we see in most states,” said Debbie Cochrane, research director for the Project on Student Debt.
“What we see in Pennsylvania is very high tuition levels for public colleges and not enough grant aid to keep up,” she said.
“It certainly is one of the most expensive states in the nation to go to college in as a state resident,” said Mark Kantrowitz, senior vice president and publisher at Edvisors.com.
On the plus side, Cochrane said researchers found debt levels for students with a bachelor’s degree, which have increased from 4 percent to 6 percent a year in recent years, grew a little slower last year, increasing to slightly more than 2 percent.
Mark Kantrowitz, a student aid expert who has testified before Congress repeatedly on the topic, said the slight slowdown in the growth of graduate debt may reflect improvements in the economy.
“During an economic downturn, more people go to college, and those people need loans. As we recover, people are going back to the job market and don’t need as much debt, and the stock market is accelerating. The next couple of years, we’ll see the growth in debt slow down and then start to increase again,” Kantrowitz predicted.
Cochrane, however, said there is a growing awareness of the need to be cautious where student debt is concerned.
At Robert Morris University in Moon, where average graduate debt levels declined from more than $41,000 in 2012 to $37,596 last year, officials like to believe an increasing emphasis on financial literacy and responsible borrowing is having an impact.
“We increased money for financial aid and made a concerted effort to keep costs as low as possible,” said university spokesman Jonathan Potts.
Graduates from public universities experienced debt levels nearly that high.
About 69 percent of graduates from the University of Pittsburgh carried debt averaging $34,623, while 84 percent of the graduates of the school’s Greensburg branch campus clocked in slightly higher, with debt averaging $35,700.
At Penn State, where 66 percent of the new graduates had outstanding loans, debts averaged $35,430.
The new report cited even higher debt among graduates at Indiana University of Pennsylvania, with 85 percent of graduates carrying debt averaging $37,457.
IUP spokeswoman Michelle Fryling said the figure was inflated because of a software glitch that included Parent Plus. The corrected figure is more like $32,700, she said.
“Debt can be a very important investment in a student’s future, and what is most important is that when students leave college the debt is manageable for them,” Cochrane said.
Kantrowitz said debt is usually manageable as long as graduates don’t borrow more than the starting salary for their first job.
“The average starting salary for bachelor’s degree nationwide is $40,000 to $45,000. But those are averages, and if you end with more debt, you’re going to struggle to repay those loans,” Kantrowitz said.
Debra Erdley is a staff writer for Trib Total Media. She can be reached at 412-320-7996 or [email protected].