At the White House’s College Opportunity Summit in 2014, President Obama emphasized that a college degree “has never been more valuable.” But millions of college graduates, saddled with increasing student debt, are questioning whether their degree was worth the trouble.
We analyzed data released on August 15 by the Federal Reserve Bank of New York, which shows that student loan debt is growing at a faster clip than any other household debt — by an incredible 457.68% since records began in the first quarter of 2003. Compare this rate to mortgage debt growth of 75.86%, auto loans at 85.65% and credit cards at 13.95%, and you’ll understand just how staggering this growth is.
The growth of total household debt since Q1 2003
Type of household debt | Total in Q1 2003 | Total in Q2 2017 | Change percentage |
---|---|---|---|
Mortgage | $4.94 trillion | $8.69 trillion | 75.86% |
Home equity line of credit | $242 billion | $452 billion | 86.78% |
Auto loan | $641 billion | $1.19 trillion | 85.65% |
Credit card | $688 billion | $784 billion | 13.95% |
Student loan | $241 billion | $1.34 trillion | 457.68% |
Other | $478 billion | $378 billion | (20.92%) |
Total | $7.23 trillion | $12.84 trillion | 77.55% |
Source: finder.com, Federal Reserve Bank of New York
How much debt?
Student loan debt now stands at a record $1.34 trillion, increasing by $85 billion from the same time last year — representing a 6.75% year-on-year growth.
Student loans now make up 10.47% of total household debt, the second-largest component of household debt in the US after mortgages. In contrast, student loan debt was the smallest component of household debt in the first quarter of 2003, making up just 3.33%.
Student loans is the only loan type to have steadily grown throughout the global financial crisis, increasing persistently throughout 2010 when all other household debt types suffered negative year-on-year growth.
Underemployment causes $462.3 billion in student loan waste
According to the Federal Reserve Bank of New York’s Labor Market for Recent College Graduates report, 43.7% of recent graduates — those ages 22 to 27 with a bachelor’s degree or higher — are underemployed, which means they’re working in jobs that don’t require their degrees.
Worse still, the report also found that 34.4% all college grads are underemployed. If 34.4% of total student loan debt is not contributing to a relevant job, that means some $462.3 billion in student loan debt is potentially repaid by people in jobs that don’t require the degree that cost them so much to earn.
Nearly 2 in 5 Americans don’t see value in their college degree
A new July 2017 survey of 2,245 Americans commissioned by finder.com and conducted by global research provider Pureprofile found that nearly 2 in 5 Americans — or 38.7% of those surveyed — are either unsure if or solidly don’t think their college degree was worth the money. That’s an estimated 60.96 million Americans.
Of these degree holders, 49.6% say they aren’t making use of their degree, while nearly 1 in 5 (19.6%) say they haven’t found a job in their field.
Why was your college degree not worth it?
Of those saying that their college degree wasn’t worth the money, the majority (49.6%) say the reason is because they aren’t making use of it. This reason was followed by not being able to find a job in their field of study (19.6%), dropping out of college (16.1%), changing careers (10.0%) and changing degrees (4.6%).
Further findings from finder.com’s July 2017 survey
Findings by gender
- When it comes to who has earned a college degree, 69.8% of men have a degree, compared with 61.5% of women.
- More men think that their college degree wasn’t worth the money — over 1 in 4 (23.4%) say so, compared with 17.3% of women.
- 51.2% of women say they’re not using their degree, compared with 47.4% of men.
- Men are more likely to identify changing careers as the reason their degree isn’t worth it, sitting at 12.1% compared with 8.5% of women.
Findings by generation
- Gen Xers leads the way when it comes to possessing a college degree (66.4%), followed by millennials (65.2%) and baby boomers (55.0%)
- Baby boomers most see the value in their college degree, with 72.7% saying it was worth the money, followed by 60.1% of millennials and 59.1% of Gen Xers.
- More millennials have dropped out of college (16.8%), changed careers (12.6%) or changed degrees (6.3%) than any other generation.
- Gen Xers are using their degrees the least (56.2%), followed by baby boomers (50.0%) and millennials (44.8%).
- Baby boomers identify not being able to find a job in their field as the main reason their degree wasn’t worth the money (25.0%), followed by millennials (19.6%) and Gen Xers (18.1%).
Findings by state*
- The top three states with the highest proportion of residents with a college degree are Arizona at 74.5%, California at 69.6% and New York at 68.6%.
- The top three states with the highest proportion without a college degree are North Carolina at 47.6%, Virginia at 42.9% and Pennsylvania at 41.4%.
- Of these states, college graduates residing in New York are more likely to believe their degree wasn’t worth it or are unsure about whether it was worth it (47.1%), followed by Arizona (44.3%) and Washington (40.0%).
*Seventeen states were analyzed that had a sample size of more than 40 respondents per state in the survey.
September 20, 2017

Jennifer McDermott
Consumer advocate helping people to improve their personal finances.
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