Mansour Speaks to Local Media on Cost of Higher Education

Turner College associate professor of economics Fady Mansour spoke recently with WRBL's Hannah James about the cost of higher education. According to James' report, this October 43 million Americans will resume payments on their federal student loans with no debt relief on the way. The Supreme Court struck down President Biden’s plan to forgive up to $20,000 per person. That plan would have completely erased nearly 20 million students' debts. “It is more expensive to be a student now because the cost of education went from $4,000 in 2003 to $11,500 in 2023,” Mansour told WBRL's James. “Even if you account for inflation, it goes from $6,000 [2003] to $11,000 [2023]. So, it’s double.” Not only is obtaining a degree more expensive, but Dr. Mansour also says more jobs require workers to have a degree. “It’s not just about the cost of education 20 years [ago] and now, it’s the importance of education. It’s imperative now to have an education. So, if you look at 20 years ago, you may have another way to make your living,” Mansour said. “But right now, we don’t have any other way. Even very low skilled jobs now, they still require some education. You still have to deal with computers. You still have to look at the screen. So, you need some education to do that.” According to James' report, monthly payments are projected to cut down the amount of spending which could have a negative impact on the economy. “The burden will fall disproportionately on people in the lower- and middle-income quartiles… they own more than 50% of the student loans,” Mansour said. “With around $43,000 average debt. The $43,000 for these people, that’s almost 100% of what they make per year.” Mansour told James that the average monthly statement for loans is $200 which comes out of borrower’s disposable income. Instead of putting $200 back into the economy by going out to eat, shopping, or travelling; it will all go back to their loan servicer. “People basically in the last two years spent more on service, we went from order spending during the pandemic to service spending after the pandemic. People went out and spent on airline tickets and traveling and all of that, so that’s a downside risk for the whole economy.” Credit card spending has crossed over a trillion-dollar threshold compared to $873 billion pre-pandemic. Credit card payments with higher interest rates added onto student loan repayments could trigger bankruptcies for some of those middle to low-income borrowers.