Default rates of recent borrowers on student debt are the highest they have been in twenty years. Between 2000 and 2014, student loan debt nearly quadrupled. In 2014 alone, outstanding federal student loan debt reached over $1.1 trillion (Brookings, 2015).
The inability to pay loans back will burden recent graduates for years to come and will have lasting impacts on borrowing capabilities for the future. The country is already experiencing lower rates of home ownership. In the second quarter of 2016, home ownership rates fell to 62.9%, the lowest they have been since 1965. The home ownership rate for those aged between 18 and 35 was a mere 34.1% (Wall Street Journal, 2016).
Recent research has focused on the rise of for-profit institutions as a major cause of the debt crisis (Brookings, 2015). In 2000, enrollment at for-profit colleges was at 650,000. In 2010, it was up to 2.5 million (Brown Center on Education Policy, 2016). Seventy percent of students who left school and started to repay federal loans in 2011 but defaulted in 2013 were borrowers from for-profit and 2-year institutions (Brookings, 2015).
In 2013, the U.S. Department of Education published the College Scorecard, an online tool to help students analyze their options for higher education through disclosure of key academic and economic factors. The Scorecard is also meant to hold colleges and universities fiscally accountable, publishing information on default rates, repayment plans, and graduates’ earnings. The data in the above maps comes from the U.S. Department of Education College Scorecard raw data set, which includes information for 1996 through 2013.
I was curious to see how student debt has changed since 2000 and where for-profit institutions have opened across the country. The Scorecard raw data provides information on median debt for students who have completed their degree by institution. The Scorecard also includes the total number of students accounted for in the median debt cohort. To find the state averages, I multiplied the median debt per student by the total cohort for each institution, summed the total debt, and divided it by the total number of students in the state. I thought it would be most helpful to see how this has changed over time and decided to show the change in student debt between 2000 and 2013.
According to the Scorecard data, the average debt per student was $12,329 in 2000. In 2013, it was $25,824. The states with the highest debt per student in 2013 were Hawaii ($30,745), Arkansas ($30,538) and Nebraska ($30,467). The states with the lowest debt per student were Wyoming ($14,039), Alaska ($16,904) and Rhode Island ($20,483). Arkansas students had the greatest increase in student debt at 173% (from just over $11,000 in 2000 to over $30,500 in 2013); the state with the least change was Alaska at a 46% increase (from just over $11,500 in 200o to $16,900 in 2013). To show the data in CartoDB, I merged the data set with the 50-states set and joined them by state name. Hovering over each state allows the audience to see percentage point changes.
The second map shows the number of for-profit institutions between 2000 and 2013, as provided by the Scorecard. Since the institutions remain on the list once they have opened, I chose to show this map as “cumulative”. This also demonstrates how much the for-profit higher education sector has grown.*
For both maps, I chose to use a dark base map and bright colors for the data. This allows the data to be more easily read. Since debt has a negative connotation, and since student debt has increased across the board, I chose to show change in student debt using a range of orange and red colors. The color for the for-profit institutions does not have a numeric representation and so I looked for a color that would pop against the backdrop.
Moving forward, it would be interesting to compare these maps with other data related to student loan debt. For example, policy makers and urban planners might look into how home ownership rates (particularly among those between 18 and 34) have changed in states with the highest increases in debt per student.
*The negative to this is that it does not show if/where an institution has closed.
References:
Raw Data Download: https://collegescorecard.ed.gov/data/
http://www.ed.gov/news/press-releases/education-department-releases-college-scorecard-help-students-choose-best-college-them
https://www.brookings.edu/wp-content/uploads/2015/09/LooneyTextFall15BPEA.pdf
https://www.brookings.edu/wp-content/uploads/2016/07/cellini.pdf
Different degrees of debt: Student borrowing in the for-profit, nonprofit, and public sectors