Another victim of the pandemic: jobs after college

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I am a senior in college. I am ready to graduate this May. I’m not ready to pay off my student debts without a job.

Of course, none of us were prepared for the COVID-19 pandemic. The shutdown that occurred in March was unprecedented and cost millions of jobs. Among them were recent university graduates. How are they supposed to start their careers when job opportunities are so tight?

In addition to fear of the job, college graduates have another concern: student debts. According to a US News poll, the average student today owes at least $ 30,000. How is this student going to start making these payments without a job? Consumer data firm Statista says that as of June, 13 percent of college graduates in the US were unemployed – just like they graduated from. That was 9 percent more than in the months before the pandemic.

Given the pandemic, college graduates may be looking for jobs longer than they’d hoped. For many of them, internships and fieldwork have been cut in the spring semester of 2020 and dropped in the fall, and the labor market is currently not forgiving. Talent Board, a nonprofit employment research platform, found that 74 percent of companies reduced their hiring in some way and 32 percent were completely hired.

Graduates are given a six month grace period before they have to start paying the loan. You can defer loan payments for up to three years, but interest will still be charged. In light of the COVID-19 emergency, the U.S. Secretary of Education ordered the Federal Student Aid Office to suspend loan payments, stop collecting defaulted loans, and set interest rates at 0 percent for 60 days. This was in effect until September 30th. It was recently extended to December 31st.

Here’s the catch: this only applies to federal Student Loans. It has nothing to do with personal student loans, which, according to MeasureOne, a consortium of lenders, accounts for 7 percent of all student loans. Seven percent isn’t a huge number, but the alumni holding these loans will struggle to make payments in this pandemic. I have $ 10,000 in a private student loan and the interest will pile up when I graduate.

America’s 44 million people owe a total of $ 1.6 trillion in student debt – most of the world, according to a 2018 report by the Federal Reserve Bank of New York. Connecticut has the third highest average student debt in the country at $ 38,546 as of the close, according to the Institute for College Access & Success. The big question: what is the solution?

When students complete FAFSA, the free federal study grant application, those who qualify receive college aid packages. If they are unable to make payments after they graduate, it will destroy their creditworthiness and increase their debt. Graduates need a grace period longer than just six months to repay their loans. They need a break before they can show they have jobs.

Loan payments should be deferred for a year or until the graduate shows that he or she has a job. According to Do It, a Washington University program that helps students improve their career changes, college graduates can take three to six months to find jobs after graduation – but that estimate was made before the pandemic. The unemployment rate among 20 to 24-year-olds reached almost 26 percent in April in the wake of the pandemic. A one-year grace period would give graduates time to find a job and put money aside to pay off loans.

A college education shouldn’t cost you the rest of your life. If we readjusted the expectation that students would make monthly loan payments right after graduation, young adults would have a chance to be financially responsible and successful.

Kiley DeGrand is a senior at Central Connecticut State University.


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