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Student loan burden is rising for state graduates

Higher ed leader warns of impact

More students in Massachusetts public universities and colleges are incurring larger amounts of debt to finance their educations, a trend that could bring dire consequences for the region’s economy if not reversed, the state higher education commissioner told lawmakers Monday.

“Let me sound the alarm on this issue,” Commissioner Richard Freeland told lawmakers at the fourth in a series of hearings on college debt. “Make no mistake: The burden of student debt could derail us from achieving our goals.”

The average debt for graduates of the University of Massachusetts system, other state universities, and community colleges increased 27 percent from fiscal 2008 through fiscal 2011, the last year for which data are available, Freeland said. And the percentage of graduates who accumulated debt rose across all levels, including a high of 64.8 percent at the state universities in 2011.


“This debt not only creates risks and hardship for individual students,” Freeland told members of the joint Committee on Higher Education, which met at Suffolk University, according to a transcript of his remarks. “When a college degree or certificate becomes a dream deferred because a student can’t afford the cost of a diploma, the impact is felt far and wide.”

The average graduate in the UMass system left with $26,844 in debt in 2011, an increase of $5,525 over three years earlier, Freeland said. At state universities such as Salem State and Bridgewater State, the figure was $22,362, a jump of $4,822.

For graduates of community colleges, the average debt in 2011 ranged from $7,229 for graduates with associate degrees to $4,655 for graduates with one-year certificates or less.

Escalating college debt has become an enormous problem that Massachusetts must confront, said state Senator Eileen M. Donoghue, a Democrat from Lowell who is cochairwoman of the subcommittee that Freeland addressed.

“We are hearing from students who are really struggling and just trying to stay in school and working sometimes two or three jobs and still coming out of school with enormous debt and no job prospects,” Donoghue said in a phone interview.


The percentage of graduates who left the UMass system in debt rose to 61.4 percent in 2011 from 57.9 percent in 2008.

The biggest increase in public institutions, to 48.6 percent from 31.1 percent, was registered by community college graduates with one- or two-year certificates.

Freeland said these trends could drive more young people away from public colleges when the state needs more graduates in science, high technology, health care, and finance. The consequences will be costly if Massachusetts wants to continue to compete in a global economy.

“We anticipate rising labor-market shortages in those fields,” Freeland said in an interview. “That will be a real challenge for the economy going forward.”

Donoghue agreed that access to an affordable degree is becoming increasingly important as the burden of paying for college has shifted from the state to students and their families.

“Having a higher education and having a college degree is becoming much more essential in this state,” Donoghue said.

The state significantly boosted aid to higher education this fiscal year, by $147 million to a total of $1.08 billion.

However, Freeland and Donoghue cautioned that more, substantial investment is needed to reduce the financial burden on the system, whose four-year institutions raised mandatory student fees by 106.3 percent in the past decade.


“The turnaround in state funding we saw in fiscal ’14 needs to continue,” Freeland said.

As fees have skyrocketed, state aid for low-income students plummeted. Before the boost in education funding this year, MassGrant, the state’s primary aid program for low-
income students, paid 8 percent of average tuition and fees, compared with 80 percent in 1988.

“Some students are almost certainly being priced out of our system,” Freeland told the lawmakers.

However, he said, he is confident that higher education can be made more affordable. Identifying operating efficiencies, such as shared information-technology systems, is one means to pare costs, he said.

But overall, he continued, what is needed is a “new financial model” that will balance what taxpayers can afford and what families and students are expected to pay.

The fledgling state Commission on Higher Education Finance is expected to consider ways to solve that problem.

“This is something our state badly needs,” Freeland said.

Brian MacQuarrie can be reached at macquarrie@