Impact of college debt may extend beyond students
Meghan and Mike McDevitt were thrilled six months ago when they found an apartment they could afford while paying more than $2,000 a month in college debt.
The Oakmont couple, married for three years, need every break they can get to make ends meet and pay their student loans. They want to have children, but he acknowledges it would be difficult to start a family now.
They're not alone. Experts suspect scenarios such as the McDevitts' contributed to record low birth rates and a stagnant economy, and could have long-term implications for everything from health care to Social Security and workforce development.
“You've heard parents and grandparents say, ‘We started with nothing.' Well, we started with less than nothing. At least we have jobs that we love,” Meghan McDevitt said.
McDevitt, 30, a lab technician who earned a degree in biochemistry from Chatham University in 2009, said she juggles payments of about $1,500 a month on seven student loans with rates of 8, 9 or 10 percent.
Her husband, 27, a kitchen manager in a restaurant, said he pays $504 a month on loans he took out to attend culinary school.
Like thousands of young adults who collectively owe more than $1 trillion in student loans, the McDevitts put their dreams on hold.
According to the Pew Research Center, the U.S. birth rate has fallen since 2007. The rate, defined as the number of children born to every 1,000 women ages 15-44, bottomed out at 62.3 last year, down from its 1957 peak of 122.7.
In Pennsylvania, where the median age is among the highest in the nation, the birth rate was 58.8 in 2012. The rate was lower in Allegheny County at 55.8.
Although no studies demonstrate a clear link between rising student debt and declining birth rates, McDevitt said she and her friends talk about that.
“I know people who have had to put off getting married and having kids,” she said.
The McDevitts said they're making loan payments to build a credit record for the day when they can buy a home. They are saving a little money — “throwing a few dollars into an account every month, so if we can have children someday, they won't have to deal with this,” she added.
Although their loans are higher than many — Meghan McDevitt graduated with almost $100,000 in debt — a survey by the Project on Student Debt estimated Pennsylvania graduates left college with an average of $29,959 in student loans in 2011 and stepped into a struggling economy.
Rising student debt poses problems across the spectrum of society, said Michael Giffin, owner of Ensphere College Planning Services in Upper St. Clair. He said mortgage-sized college debt means fewer young adults can buy homes, new cars or appliances, and that stagnates an economy that depends upon such sales.
“Too many times they are altering plans, dreams, hopes and expectations because of this burden,” Giffin said.
Gretchen Livingston, a senior researcher at Pew, said it is not uncommon for birth rates to decline during a recession. The latest declines occurred on top of years of declines attributed to couples opting for smaller families and women delaying marriage and children.
“But we have some pretty reliable data going back to 1920, and the birth rate has never been this low,” Livingston said, adding that births typically rebound as the economy improves.
Matthew Rouse, associate professor of economics at Susquehanna University in Selinsgrove, said falling birth rates endanger Social Security's solvency.
As recently as 1960, the United States had 5.1 workers for every Social Security recipient, a number that slipped to 2.9 by 2010.
“And if you have a higher percentage of older people in the population who need increased amounts of medical care, that would drive up costs even more than Social Security,” Rouse said.
Debra Erdley is a staff writer for TribTotal Media. She can be reached at 412-320-7996 or firstname.lastname@example.org.