Academic journal article American Journal of Pharmaceutical Education

It's Time to Broaden the Conversation about the Student Debt Crisis beyond Rising Tuition Costs

Academic journal article American Journal of Pharmaceutical Education

It's Time to Broaden the Conversation about the Student Debt Crisis beyond Rising Tuition Costs

Article excerpt

Keywords: student loans, debt, personal finance

INTRODUCTION

We all have heard the news about the rising student loan debt and the negative impact this has had on graduates trying to enter the workforce. This student loan debt crisis is a subject of increasing consideration, research, and analysis by federal government agencies, nonprofit organizations, economists, and the students who carry the balance. The extensive body of research from organizations, such as the Pew Research Center, includes staggering statistics that characterize the magnitude of the crisis for graduate and undergraduate students.

Student loan debt has surpassed $1.3 trillion and is rising by the minute. (1) Excessive student loan debt may affect students' career choice, diminish quality of life, negatively impact their ability to give back to their school or college of pharmacy and society at large, and delay progress on achieving other financial goals, such as saving for retirement. After all, approximately two out of five US adults (38%) paying off student loans are unable to save for retirement. (2) Suboptimal quality of life, symptoms of burnout and depression, emotional exhaustion, and increasing cynicism were commonly associated with a student's or resident's increasing educational debt in the results of a survey of US medicine residency programs and a cohort of internal medicine residents. (3,4)

While pharmacists make a good living, with an average annual income of $120,270 in 2016, (5) they, especially new practitioners, are often swimming in student loan debt. The average amount borrowed for students graduating from pharmacy school increased from $101,892 in 2009 (6) to $163,494 in 2017. (7) Looking further at the amount borrowed by pharmacy students attending public or private schools, those graduating in 2017 from public schools reported borrowing an average amount of $136,328, compared with those graduating from private schools, who reported an average amount borrowed of $ 189,317. (7) This data, according to the American Association of Colleges of Pharmacy (AACP) Graduating Student Survey, asks respondents to report how much they will owe at the date of graduation. The question is stated as follows: "If you borrowed to help pay for your college expenses in the PharmD degree program, please estimate how much you will owe at date of graduation." The responses likely have a notable degree of variability based on the respondents' interpretation of the question. Some may interpret this to include total loan balance owed (undergraduate loans include) whereas others may assume it is only referring to expenses from the doctor of pharmacy (PharmD) program. In addition, some may include money borrowed for cost of living expenses, whereas others may interpret the question to refer only to borrowing costs related to tuition and fees.

Tuition increases in pharmacy education and higher education at large have played a significant role in rising student indebtedness. The average in-state annual tuition for schools and colleges of pharmacy almost doubled between the 2005-2006 academic year and the 2015-2016 academic year ($14,796 and $28,956, respectively). (8) The Center on Budget and Policy Priorities points to state funding cuts to higher education institutions as a main factor in rising tuition resulting to an increased cost burden placed on the borrower. (9) While pharmacist salaries have continued to rise each year, Cain and colleagues documented the annual salary of a pharmacist continues to be less in recent years in relation to overall student indebtedness. (10) For example, in 2016, the average pharmacis 's salary was $120,270. (5) The average amount borrowed for a graduate in the class of 2016 was $157,425. (11) This salary-to-debt ratio of 0.76 is lower than that in 2011 (0.98), the first year the ratio fell below 1.0. (10) This may be explained by a variety of factors, including student utilization of more unsubsidized loans, higher interest rates for public and private loans, fewer scholarships and other financial aid available to students, and a rise in the amount borrowed to cover the necessary cost of living beyond tuition costs. …

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