For Crippling Debt, Why Not Try Grad School?

There’s something even worse than undergraduate debt. It’s graduate-school debt. According to the American Student Assistance website, which uses figures from such sources as the National Center for Education Statistics, the College Board, and the nonprofit Finaid.org, 60 percent of recipients of bachelor’s’ degrees borrowed to fund their education during the 2000s, with the average debt load per borrower on graduation close to $23,000 by 2007. By 2010 that figure had jumped to more than $25,000 per borrower, according to the Institute for College Access’s Project on Student Debt.

Those numbers sound bad, but what if you go on to obtain a master’s degree, adding another one or two years’ worth of education to your resume? According to American Student Assistance, nearly half of those who obtained master-of-science degrees during the late 2000s borrowed to finance their schooling, and their average cumulative debt load for those two years was $29,975–on top of what they already owed for their bachelor’s degrees. Of recipients of master-of-arts degrees, degrees that typically qualify their holders mostly for low-paying teaching jobs at community colleges and private high schools, 61 percent borrowed to finance their two additional years of education, with a per-borrower average debt of $29,975.

And what if you go all the way to a doctorate in the humanities or sciences? Fewer students have to borrow in order to earn Ph.D.’s (graduate schools typically subsidize tuition and pay modest stipends in exchange for on-campus teaching or research). Still, 35 percent of doctoral students in the humanities and sciences went into the red to pay for at least part of their education and living costs, racking up an average cumulative debt of $44,995, according to American Student Assistance. About 48 percent of doctoral students had borrowed for their undergraduate degrees, and the total average cumulative amount borrowed for both degrees was $45,455.

Now let’s factor in two additional pieces of data that bring home what it means to owe $45,000 for your Ph.D. after the ceremonies are over and you’ve stashed your doctoral gown inside its garment bag. First, you are likely to be as much as a decade older than your college classmates who collected only a bachelor’s degree before setting out on a career path. According to the National Science Foundation, the median time spent registered in graduate school in order to earn a doctorate is 7.5 years. The median age of recipients of Ph.D.’s in science and engineering is 31.8 years. Among recipients of Ph.D.’s in the humanities the median age is 34.6 years. That is because it takes an average of nine years in school to earn a doctorate in the humanities. The total average time from receipt of bachelor’s degree to receipt of doctoral degree is about eleven years in the humanities and nearly eight years in science and engineering.

Men and women outside academia who are in their early thirties are typically feeling ready, or even more than ready, to buy homes and start families. They are also typically feeling financially able to shoulder those new financial burdens, with careers nailed down and netting them decent incomes, most student loans paid off, and savings accumulated for down payments. Not so the members of their age cohorts who chose to go to graduate school instead. They are at the bottom of their career ladders and salary scales, just as their college classmates who didn’t attend graduate school were ten years ago–except that the Ph.D.-holders now owe on average nearly twice as much in student debt as their former classmates. Holders of doctorates do earn more than holders of bachelor’s and master’s degrees, but not much more. The average starting salary of an assistant professor on the tenure track, for example, can be as low as $37,500 a year and almost never tops $60,000. A study cited by the Economist in 2010 found that a Ph.D. gives its holder only a 3 percent earnings premium over a master’s degree, which takes only one or two years to complete. The study noted that in some fields, such as mathematics, computing, social sciences, and languages, holders of doctorates earn no more than holders of master’s degrees. They have also incurred the opportunity cost of foregoing years of income that would have helped them pay off existing student loans.

Think Twice about Doing This

It gets worse. Doctoral programs are essentially vocational training–for the job of college professor. But the training is so time-consuming and exacts such a psychic toll, with Ph.D. students struggling for years to squeeze in research on their dissertations as they cope with the backbreaking hours and abject penury of a teaching assistant, that the dropout rate is extraordinary. Only about 57 percent of students who enroll in doctoral programs complete their degrees, according to a 2007 report from the Council on Graduate Programs. Students in the humanities, especially English and history, fare the worst, with about a 49 percent completion rate. In the humanities the dropouts tend to cluster in the later years of the program when the students finally run out of money and hope. That translates into up to a decade wasted in academia with nothing to show for those years except forgone earnings elsewhere and in many cases, more debt.

Those who do manage to collect their doctorates–at about age 35 for the humanities–face a further horror. There are very few jobs, or at least very few of those full-time, tenure-track teaching jobs, even at $37,500 a year, for which their highly specialized education has prepared them. The humanities, as ever, occupy the bottom of the misery index. The Modern Language Association, the leading professional organization for English and foreign-language professors, projects one-third fewer professorial job openings during the academic year 2011-12 than during 2007-08–and that’s a slight improvement over last academic year. Yet the STEM fields (science, technology, engineering, and mathematics), where financial support from universities is higher and doctorates get completed more quickly, don’t offer significantly better job prospects for their newly minted Ph.D.’s. The typical career path for nearly half of them these days doesn’t start with a tenure-track assistant professorship but with two, four, or even more years as a lowly “postdoc” laboratory researcher earning a starting salary of about $42,000 a year. That doesn’t help pay down student loans very quickly.

What to do about this? “The gigantic indebtedness of graduate students threatens to turn them into intellectual sharecroppers,” Leonard Cassuto, an English professor at Fordham University, wrote recently in the Chronicle of Higher Education. Cassuto’s proffered suggestions–that the government pay for graduate education and that universities hire more tenure-track professors–don’t sound realistic in these economically pinched times. A more practical suggestion would be for more college graduates to think twice about enrolling in grad school. If $25,000 in student loans sounds daunting, why boost that figure to $45,000–especially since the jobs won’t be there to enable you to pay it back?