More IonTuition data suggests a potential cycle of perpetual loans is already in the works. Generation Z plans to use federal student loans to pay for college more than any other source. According to the data, 64% of Generation Z respondents plan on using federal student loans as one source of paying for college compared to just 40% of current workforce respondents. The highest category for the older population was parent and family help, which had a rate of 55%. That number slipped by six full percentage points for Generation Z respondents. In general, Generation Z seems to be savvier with their college payment plans that previous generations. Some 43% plan to work a part-time job compared to the just 22% of college graduates that said they did the same. What’s more, 35% of Generation Z say they have their own personal savings already stowed away for college compared to 26% of older generations.
“Between the recent economic issues and an increasing percentage of parents carrying their own student loan debt later in life, many families do not have the option to take out PLUS loans,” IonTuition’s report reads. “Over 20% of Generation Z said their parents are still paying back their own loans and will likely not take out more.”
All of this could be a good thing for business schools. According to the data, business, management, and finance are the most popular career fields among Generation Z respondents. The business fields topped engineering, which was the most popular among current college graduates. Engineering’s popularity among Generation Z dropped quite a bit and ended up being the fifth-most popular career field, tied with psychology. The data makes sense. Business majors from the top schools are making large sums of money. And biz majors are also finding jobs in the industries and at the companies they desire.
More than any generation before, Generation Z expects their employers to help pay back student loans. “As college costs rise and available family help shrinks, more workers are struggling to manage their student loan debt,” the report reads. “Employers who want access to the best talent in the future will need to align their benefits with the needs of these employees.”
According to the report, 74% of Generation Z respondents think “employers who favor a college education should help repay their workers’ student loans.”
“The difference between the emerging workforce and present workforce is that Generation Z has a strong expectation that employers should help pay down their loans,” the report continues. “College-educated employees have demonstrated that they have the capacity to handle an aggressive workload and be responsible for deliverables. They’re also qualified, trained, and have a passion for their chosen fields. Employers that reward graduates entering their field by compensating them for their up-front college investment will continue to see great returns.”