Why the gap exists
“Gender is not talked about enough in conversations about student loan debt – both in debt acquisition and payment,” says Persis Yu, director of the National Consumer Law Center’s Borrower Assistance Project for Student Loans. “One of the explanations for why women tend to get into more debt is because they tend to have more expenses, like people who are going to go back to school and who have children”.
Yu adds that the gender pay gap affects the ability of women borrowers to repay their loans. “If you make less money, you will be able to pay the debt more slowly. This is just a fact of life, ”she says. “We know that these disparities and inequities exist across society, across the workforce. And therefore, this will also be reflected in the student loan market.”
“Women earn less than men with the same level of education. And therefore, if they asked for exactly the same amount to get the same education, it would be more difficult for women to pay this debt because they have lower income, ”explains Sandy Baum, senior fellow at the Urban Institute and emeritus professor of economics at Skidmore College . “Another issue is that women are more likely than men to attend for-profit institutions, which creates problems for many people.”
According to the National Center for Education Statistics, only 21% of for-profit college students graduate in six years. That rate is almost four times higher at nonprofit colleges and universities, on average. For-profit graduates earn 11% less compared to graduates of public universities and, according to the Brookings Institution, about half of students who take on debt to study at a for-profit college do not pay their loans, compared to 19% of nonprofit private non-colleges borrowers and 18% of borrowers in public non-profit colleges.
Women are also more likely to attend graduate school, which often requires taking out significant student loans, further contributing to the gender gap in student debt. And Aaron Taylor, executive director of the AccessLex Center for Excellence in Legal Education, explains that race also impacts students’ gender debt gap.
“Sometimes, when we see gender-based disparities that show that women have higher debt burdens or are impacted by student debt more than men, it really is a racial impact that is masked as a gender impact” said Taylor. “What I mean by that is, for example, if you look at the enrollments of black and Latino law students, anywhere from 60% to 65% of those enrollments among these groups are women, so if you try to find out the statistics for white women specifically, and compared to white men, would be more comparable. Only when you add black women who are in law school do you start to see bigger disparities happen. “
“African American women with graduate degrees still earn less than white men with just a college degree,” adds Yu. “Due to the way the job market is set up, women, people of color, and especially women of color, really need to obtain this credential to compete in the job market. And that means that they are going to incur a lot more debt. “
The AAUW estimates that white women with loan debts to undergraduate students borrowed $ 31,346 on average. Black women in debt to undergraduate students borrowed closer to $ 37,558.
Student debt forgiveness
Gender and race gaps in student debt are among the reasons why lawmakers are advocating for significant student debt relief.
House and Senate Democrats urged President Biden to “largely” forgive up to $ 50,000 of federal debt through executive order, an approach that Senate majority leader Chuck Schumer has repeatedly reiterated that Biden should adopt during his first 100 days in office.
“The student debt crisis is a matter of racial and economic justice and we must finally begin to treat it as such,” said Congresswoman Ayanna Pressley in a December 17 statement. “Debt cancellation for broad-based students is precisely the kind of bold, high-impact policy that the broad and diverse coalition that elected Joe Biden and Kamala Harris expects them to deliver.”
Kyle Southern, director of higher education policy and workforce for the advocacy group Young Invincibles, voiced his support for Pressley’s resolution, arguing that widespread debt forgiveness could address racial and gender inequalities.
“Taking this action is critical to advancing an equitable economic recovery. The increasing impact of systemic racism and gender discrimination on borrowing students who are black, Latino and women means that they incur more debt out of necessity and delay more to pay those debts, “he said in a statement. “Currently, women who take out loans hold two-thirds of all student debts. The widespread cancellation of student debts would substantially increase families led by blacks, Latinos and women, help close the racial wealth gap and avoid default.
Biden is expected to ask Congress to forgive $ 10,000 in student debt to borrowers.
And since most student borrowers are women, women are likely to be the majority of those receiving assistance.
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