SPI Education Press Release

Nothing to show for it: Distress among non-degree earners with debt

Press release: May 11, 2022

According to a study by the Social Policy Institute at Washington University in St. Louis, the convergence of college non-completion and student debt among borrowers lead to higher rates of material hardship, healthcare hardship, and financial difficulties than those with a high school degree, those with a college degree, and those with some college and no debt.

“Students with non-degree debt are facing a double jeopardy in their financial lives,” says Jason Jabbari, research assistant professor at the Social Policy Institute and Brown School, and first author of, “Nothing to show for it: Financial distress and re-enrollment aspirations for those with non-degreed debt,” published earlier this month in Research in Higher Education.

“Not only do they have this debt, they also have nothing to show for it. It’s unproductive debt that comes with interest and is paid back usually from jobs with low earnings and limited growth.”

Despite these findings, Jabbari and co-authors believe there are benefits in pursuing a college degree given the potential to earn a premium salary that can help pay down debt. Additionally, students who did not earn a college degree and had debt were more likely to want to return to school and complete their degree in the future than those with a high school degree and those with some college and no debt. The financial investments may motivate these students to complete their degree and therefore, increase their earning potential.

“Rising default loan rates and ballooning student debt levels impact all aspects of the economy,” says Jabbari. “If we don’t look at the impact on those with non-degree debt, we may all pay the price for it.”

Co-authors of this publication include Mathieu Despard, associate professor at UNC Greensboro, Olga Kondratjeva, senior data analyst at SPI and operations research specialist at Washington State Employment Security Department, Brinda Gupta, program manager at SPI, and Michal Grinstein-Weiss, director at SPI.