Class is back in session this week for college and university students, and while the frosh parties ensue, there will be no doubt who will be serving the drinks, and who will be largely responsible for the hangover.
Public student loan programs across Canada will pump an estimated $2.7 billion into the pockets of students this year, adding to the some $28 billion of outstanding student debt.
A report issued last month by accounting firm Hoyes, Michalos & Associates revealed that some 18 per cent of insolvency filings handled in 2018 involved student debt — a 38-per-cent increase since 2011. Across the country, default rates for student loans sit at around 10 per cent, a shockingly high number when compared with the 0.24 per cent delinquency rate for mortgage debt and 1.2 per cent for other consumer debt, such as credit cards.
University students have long embodied a deep sense of exceptionalism — they believe that their education will provide for a life of comfort because, for the most part, it has. Men in Canada with college diplomas earn about 19 per cent more than those with only a high school diploma over the course of their careers. That number is even higher for those with a bachelor’s degree, who earn about 38 per cent more cumulatively. For women, the earning advantages of higher education are closer to 12 per cent and 58 per cent respectively. On the surface education is still a worthwhile investment.
But beneath the waters there are deep currents of uncertainty.
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