Report: Black Graduates Borrow At Higher Levels Than White Graduates

By Brittany Hackett, Communications Staff

Black college students continue to borrow at higher levels to pay for higher education than white students and are less likely to thrive financially after graduation, according to data from the inaugural Gallup-Purdue Index. 

The data, released September 18, shows that 50 percent of black graduates from 2000-2014 report graduating with more than $25,000 in undergraduate student loan debt, compared with 34 percent of white graduates. Nationally from 2000-2014, 35 percent of college graduates report graduating with over $25,000 in debt.

Twenty-eight percent of black and white graduates report borrowing less than $25,000, while 22 percent of black graduates and 39 percent of white graduates report graduating with no debt.

More than half (58 percent) of black graduates are first-generation college graduates, the report said, compared with 44 of white graduates. “But college is fast becoming an expectation in many black families, with larger percentages of black college graduates saying they were not the first in their family to graduate college,” according to the report. 

While it “might seem puzzling” that the need for black students to borrow for college remains up even though more students are graduating and coming from college-educated families, and thus having increased earning power, the report authors note that this “dynamic is not exclusive to black college graduates.” Contributing factors may include the increase in tuition and the issue of income and wealth gaps between the races “that has failed to close” the report said. 

The data also examines four “elements of well-being,” which previous Gallup-Purdue Index research has shown to be lower for graduates with more student debt. The newest set of data is consistent with those findings, showing that black graduates show lower rates of well-being than other recent college graduates, likely due in part to their likelihood of having more than $25,000 in debt.

Seventeen percent of black graduates from 2000-2014 are classified as thriving in the area of financial well-being, compared with 31 percent of white graduates and 29 percent of all college graduates from the same time period. Recent black graduates also trail their counterparts in the areas of purpose and community well-being.

“This is not to suggest that these lower levels of well-being can be explained solely by the fact that black college graduates borrow at higher rates than other graduates do,” the report authors note. “But these findings are significant in that they reveal well-being difference between the races even among college graduates, a segment of the population that has achieved the same propitious milestone in life – namely a college degree.”


Publication Date: 9/22/2014

Thomas Z | 9/26/2014 8:17:14 AM

Although this article uses statistics, I am unsure of why we would need to classify borrowers based on race. The question lies in how does one's race have anything to do with their borrowing behavior(s)?

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