College Was Supposed to Close the Wealth Gap for Black Americans. The Opposite Happened. (WSJ)

[twin_ghost]

Black millennials thought college would help them get ahead. Instead, it is setting them back.

The median net worth of households with Black college graduates in their 30s has plunged over the past three decades to less than one-tenth the net worth of their white counterparts, according to a Wall Street Journal analysis of Federal Reserve data. The drop is driven by skyrocketing student debt and sluggish income growth, which combine to make it difficult to build savings or buy a home. Now, the generation that hoped to close the racial wealth gap is finding it is only growing wider.

More than 84% of college-educated Black households in their 30s have student debt, up from 35% three decades ago, when many baby boomers were at the same age. The younger generation owes a median of $44,000, up from less than $6,000. By comparison, 53% of white college-educated households in their 30s have debt, up from 27% three decades earlier. The median amount rose to $35,000 from $8,000. All figures are adjusted for inflation.

https://www.wsj.com/articles/college-was-supposed-to-close-the-wealth-gap-for-black-americans-the-opposite-happened-11628328602

The complete article is behind a paywall.

[brush]

1. Student debt is the cause. The cost of attending college has skyrocketed.

[Hangingon]

4. I would ask what academic majors are involved

[brush]

5. No matter what major, the cost has skyrocketed.

If one didn't get a free ride scholarship or had parents who could afford it, paying back five, and in some cases, six figure student loans holds graduates from progressing in life.

[Hangingon]

6. Yes the costs went up.

There is however a big difference in the salaries paid for different majors.

[brush]

7. No doubt.

[Klaralven]

2. Simplistic analysis that doesn't take into account the colleges attended or the subjects majored in.

The Journal’s analysis is based on the Federal Reserve’s Survey of Consumer Finances, which examines household wealth and census data. The analysis sorted the data by age, race and level of education. The Journal aggregated the results from 1989, 1992, and 1995 and compared them to the results of surveys conducted in 2016 and 2019 to capture more families with graduates in their 30s than participating in a single survey.

https://newsnetdaily.com/the-college-was-supposed-to-close-the-wealth-gap-for-black-americans-the-opposite-has-happened/

The raw "level of education" is an inadequate predictor of economic value of a college education. A BS in Computer Science from a top state school is much more valuable than a BA in Classical Civilization from a second tier state school.

[Progressive Lawyer]

10. I suspect a major cause of the income discrepancy is the "for-profit career colleges"...

...much more than the differences between real accredited colleges.

[Klaralven]

11. There are 3 kinds of colleges

For profit colleges where the investors feather their nests.

Non-profit private colleges where the administrators feather their nests.

Public colleges where the coaches feather their nests.

[Demovictory9]

3. student loan debt is insidious and crippling.

[WhiskeyGrinder]

8. Abolish student debt now.

[StarfishSaver]

9. An example of how the racial generational wealth gap - imposed by decades of systemic racism

continues to drive racial inequities.

Thanks to racist government and banking policies that benefitted whites and excluded Blacks, white families were able to build up assets and wealth that made it easier to fund their children's educations generation after generation while Black families - even those who were able to close the income gap - were more reliant on student loans.