The Impact of Student Loans on College Graduates

Many college students face financial challenges and job considerations due to student debt

For college undergraduates, the uncertainty surrounding student loan payments has finally come to an end. As of September 1, interest accruals will resume, and payments will be due in October. This change has left many members of the class of 2024 feeling financially unprepared.

A recent report from Handshake indicates that over half of next year’s college graduates expect to have student loan debt. Among this group, almost 70% acknowledge that their debt will impact their career choices after graduation.

While 17% of students claim their debt will not influence their career decisions, and 14% remain neutral on the matter, the majority are already foreseeing the magnitude of the financial burden.

Graduates anticipate the need for extra jobs to manage bills and debt

In addition to concerns about the long-term impact of student debt, future college graduates must navigate a high-inflation environment. Monne Williams, chief impact officer at Handshake, explains that students are actively seeking jobs with higher salaries and attractive benefits, including student loan repayment options.

Furthermore, young workers burdened by debt desire flexible work arrangements that allow them to choose where and when they work. Some even plan to take on additional jobs to cover their expenses. The Handshake report reveals that more than 40% of college seniors expect to engage in gig or freelance work after graduation, with nearly half of them citing the need for extra income to cover everyday expenses and debt.

Financial stressors may worsen burnout

The growing issue of burnout among college students may be exacerbated by concerns about debt and the need for increased working hours. According to the report, 80% of the class of 2024 experienced burnout symptoms during their undergraduate studies, such as persistent exhaustion, lack of motivation, and negative emotions. This has led 25% of graduating seniors to express significant concern about experiencing burnout upon entering the workforce.

Importance of employer flexibility to young workers

In light of these stressful financial circumstances, college seniors emphasize the importance of work-life balance and mental health support from future employers. Flexibility in terms of remote work options and nontraditional working hours is not enough; students also desire the ability to take time off for major life events and personal responsibilities.

When it comes to preferences regarding job locations, 41% of college seniors express a greater inclination towards hybrid jobs, surpassing the desire for remote positions by nearly double the amount.

Williams advises employers recruiting the next generation of talent to prioritize the needs and concerns of the class of 2024. This includes highlighting loan repayment programs and mental health benefits, as well as clearly communicating the company’s commitment to flexibility and a supportive culture.