OTTAWA—Record-high levels of student debt are preventing Canadians from buying homes, making investments, and participating in the economy, says a report released today by the Canadian Federation of Students. The Impact of Student Debt details the drag high student debt has on the economy and how to fix it.
“Even with a diploma in hand, student debt is holding lower-income Canadians back,” said Jessica McCormick, National Chairperson of the Canadian Federation of Students. “Massive debts, compounded by a weak labour market, have devastating effects for graduates, their families, and the economy.”
Over 200,000 Canadians are unable to make payments on their student loans last year, an increase of over 25 percent since 2012. Despite spending over $2.7 billion each year on piecemeal financial aid and incentive programs for post-secondary education, Canadians continue to be saddled with debt in order to get an education. As a result, debt-ridden graduates entering a difficult job market are forced to return home to live with parents. 42 percent of young adults are still living at home, up 15 percent since 1981.
“An over-reliance on loan-based financial aid combined with a weak job market has created a boomerang generation of young people,” said McCormick. “Kickstarting the economy by reducing the impact of student debt must be a priority for all parties ahead of the federal election.”
The paper, titled The Impact of Student Debt, is available for download at http://bit.ly/impactofdebt
This report is published in conjunction with the first comprehensive review of all federal financial aid in Canada, released yesterday and available at http://bit.ly/studentfinancialassistance
The Canadian Federation of Students is Canada’s largest student organisation, uniting more than one-half million students across Canada. The Canadian Federation of Students and its predecessor organisations have represented students in Canada since 1927.
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