- 71% Are Saving, Despite Growing Overall Debts
- 69% Perform Community Service, 90% Registered to Vote
- Average Debt Tops $850/Month
Washington, D.C., Aug. 27, 1997—A new study of college graduates over the last five years reveals that recent grads are saving more, are involved with community service, and take more than just money into consideration when choosing jobs. But they are also more in debt than ever before, many have basic skills problems, say employers, and they are returning to live at home at high rates.
Among the promising trends, 71% of college graduates report they are saving money. Sixty-nine percent perform community service, and 90% say they are registered to vote. The report notes that life after college is about more than making money for recent graduates, with 45% citing the importance of the intellectual nature of their work in a job choice, and 42% saying it must be interesting. Only 35% said a good starting salary is critical.
The new report, "Now What? Life After College for Recent Graduates," reveals a broad picture of lifestyles, careers, and ongoing education among college graduates from 1992 to 1997. The report was released jointly by The Institute for Higher Education Policy and The Education Resources Institute (TERI).
Job prospects for 1997 graduates are very good, up 17% from last year, and average starting salaries are increasing faster than the rate of inflation, especially for engineering and computer majors. Furthermore, the demand for jobs requiring bachelor's degrees is expected to grow by 27% between 1994 and 2005.
Areas of concern, says the report, include the accumulating, combined debts of students. A typical recent graduate's total monthly debt payments—comprised of student loans, car loans, rent, and credit cards, etc.—come to $852, with credit cards and student loans as the fastest growing components of composite debt. Overall, 16% of those who borrowed to pay for college have monthly non-educational debt of over $1,000.
Employers report dissatisfaction with the basic skills of some recent grads—especially those in technical fields—in areas of abstract thinking, setting goals and priorities, interpersonal skills, and writing. The study also reports that a fourth of all recent graduates live at their parents’ home.
"Overall, we are seeing a more complete picture of college graduates emerge than we've had in the past, and much of it is very heartening," stated Ted Freeman, President of The Education Resources Institute. "They are taking responsibility for money management and community action, and see learning as a goal unto itself, not just as a vehicle for wealth. The areas of concern are systemic ones—we must find ways to lessen accumulated debt burdens for students, to enhance general skills, and to balance market demands with the diversity of baccalaureate study."
According to the report, recent grads are planning for their futures, with many saving for education, retirement, and home buying. The 71% savings rate for recent grads is significantly higher than the 55% of all families who save money. "So much of the public discussion about college has been focused on whether people get jobs, or how much they make," stated Jamie Merisotis, President of The Institute for Higher Education Policy. "But this report demonstrates that a college education has many other tangible effects, from increased civic participation to a higher quality of life. This broader portrait of recent college graduates needs to become more prominent in the national dialogue about higher education."
The Education Resources Institute (TERI) is a Boston-based, not-for profit organization providing education information and financing services. The Institute for Higher Education Policy is a non-profit, Washington-based education research group.