Financial Stress, Race, and Student Debt During the Great Recession

2021 ◽  
pp. 232949652110266
Author(s):  
Elizabeth C. Martin ◽  
Rachel E. Dwyer
Keyword(s):  
Great Recession ◽  
Financial Risk ◽  
Financial Stress ◽  
The United States ◽  
Student Loan ◽  
Student Debt ◽  
Four Dimensions ◽  
The Great Recession ◽  
Consumer Finances ◽  
Wide Range

As the onus of paying for higher education shifted from the state onto students and their families, student indebtedness grew across a wide range of households in the United States in the 2000s, especially among Black and Hispanic households. Holding student debt is a financial risk that may leave households more vulnerable to economic shocks. We study the relationship between household student loan burden and the likelihood of financial stress during the Great Recession using the unique 2007 to 2009 panel of the Survey of Consumer Finances. We find a robust positive relationship across four dimensions of student loan burden and holding constant household characteristics and previous financial stress. We find that Black and Hispanic households with higher student debt burdens experienced higher odds of financial stress relative to White households, even once accounting for prior financial stress. Our results demonstrate the importance of considering the household risk incurred in the US system of financed attainment, especially during the inevitable downturns of a capitalist economy.

Perceived Income Changes, Saving Motives, and Household Savings

2018 ◽  
Vol 29 (2) ◽  
pp. 396-409 ◽  
Author(s):  
Su Hyun Shin ◽  
Kyoung Tae Kim
Keyword(s):  
Great Recession ◽  
The United States ◽  
Household Savings ◽  
Survey Of Consumer Finances ◽  
The Great Recession ◽  
Consumer Finances ◽  
Negative Income ◽  
Income Shock ◽  
Saving Decisions

Using the 2007–2009 Survey of Consumer Finances panel dataset, we investigate whether and how changes in perceived income and saving motives are related to demand for household savings in the United States after the Great Recession. Households that perceive their current income as lower, relative to normal years are less likely to save than those who view that their income is the same as the reference point. This result holds only for those who experienced a significant negative income shock during the Great Recession. Among five major saving motives, saving for an emergency is an important factor in explaining the likelihood of saving. This study suggests that financial planners and educators should pay close attention to the role of households’ income perception and saving motives and should account for the resulting potential psychological biases in households’ saving decisions.

Disruptive Soft Law and Post-Crisis US Reform

2018 ◽  
Author(s):  
Abraham L. Newman ◽  
Elliot Posner
Keyword(s):  
Financial Markets ◽  
Great Recession ◽  
Regulatory Reform ◽  
The United States ◽  
Soft Law ◽  
Long Term Effects ◽  
The Great Recession ◽  
The Us ◽  
International Interaction

Chapter 6 examines the long-term effects of international soft law on policy in the United States since 2008. The extent and type of post-crisis US cooperation with foreign jurisdictions have varied considerably with far-reaching ramifications for international financial markets. Focusing on the international interaction of reforms in banking and derivatives, the chapter uses the book’s approach to understand US regulation in the wake of the Great Recession. The authors attribute seemingly random variation in the US relationship to foreign regulation and markets to differences in pre-crisis international soft law. Here, the existence (or absence) of robust soft law and standard-creating institutions determines the resources available to policy entrepreneurs as well as their orientation and attitudes toward international cooperation. Soft law plays a central role in the evolution of US regulatory reform and its interface with the rest of the world.

scholarly journals Measuring the availability of “good jobs” in the United States for working-class men during the Great Recession and recovery

2020 ◽  
Author(s):  
Janette Dill ◽  
Robert Francis
Keyword(s):  
Working Class ◽  
Great Recession ◽  
Food Service ◽  
The United States ◽  
Job Quality ◽  
Full Time ◽  
The Great Recession ◽  
Predicted Probability ◽  
Time Work ◽  
The Impact

In this study, we use the 2004, 2008, and 2014 panels of the Survey for Income and Program Participation (SIPP) to measure the impact of the Great Recession and recovery on the availability of “good jobs” for men without a college degree. We define “good jobs” using a cluster of job quality measures, including wage thresholds of at least $15, $20, or $25 per hour, employer-based health insurance, full-time work hours, and protection from layoff. We find that the Great Recession and aftermath (2008-2015) resulted in a 1-10% reduced probability of being in a “good job” across most industries, with especially large losses in manufacturing, retail, transportation, and food service (compared to 2004-2007). In the 2014 panel, there is only a slight post-recession recovery in the predicted probability of being in a “good job,” and the probability of being in a “good job” remains well below 2004 levels. Although the probability of being on layoff from a “good jobs” does decrease substantially in the 2014 cohort as compared to the rate of layoff during the Great Recession, our clustered measure of job quality shows that access to “good jobs” remains limited for most working-class men and that the recovery from the Recession has largely not reached the working-class.

scholarly journals What Employers Want from Interns: Demand-Side Trends in the Internship Market

2020 ◽  
Author(s):  
Carrie Shandra
Keyword(s):  
Labor Market ◽  
Great Recession ◽  
Career Transition ◽  
The United States ◽  
Demand Side ◽  
Entry Level ◽  
The Great Recession ◽  
Education Experience ◽  
College Career ◽  
Skill Requirements

Internships have become a ubiquitous component of the college-career transition, yet empirical evidence of the internship market is limited. This study uses data from 1.3 million internship postings collected between 2007-2016 in the United States to (1) identify trends in internship education, experience, and skill requirements over the Great Recession and recovery periods; (2) evaluate how these trends correspond to those observed in the traditional labor market; and (3) assess robustness across labor market sectors. Results indicate that internship education and skill requirements increased substantially throughout the recession and recovery periods, indicative of a longer-term structural shift in employer expectations about internship hiring. Additionally, growth in internship education and skill requirements largely outpaced growth in non-internship education and skill requirements over the same period, suggesting potential substitution of non-interns with interns. Post-recession employers still consider internships to be entry-level positions—yet now expect interns to have skills in hand.

scholarly journals The Differential Incidence and Severity of Food Insecurity by Racial, Ethnic, and Immigrant Groups over the Great Recession in the United States

2018 ◽  
Vol 108 ◽  
pp. 379-383 ◽  
Author(s):  
Alfonso Flores-Lagunes ◽  
Hugo B. Jales ◽  
Judith Liu ◽  
Norbert L. Wilson
Keyword(s):  
Food Insecurity ◽  
Great Recession ◽  
Decomposition Analysis ◽  
The United States ◽  
Structural Factors ◽  
Immigrant Status ◽  
The Great Recession ◽  
Extensive And Intensive Margins ◽  
Race Ethnicity ◽  
Racial Ethnic

We document the differences in food insecurity incidence and severity by race/ethnicity and immigrant status over the Great Recession. We show that the disadvantaged groups with a higher incidence of food insecurity do not necessarily have a higher severity of food insecurity, which underscores the importance of examining both the extensive and intensive margins of food insecurity. Our decomposition analysis indicates that the contribution of compositional and structural factors to the observed differences in exposure to food insecurity is heterogeneous across these groups and over the Great Recession. Finally, SNAP does not seem to fundamentally change the patterns documented.

A Pathway to Racial Equity: Student Debt Cancellation Policy Designs

2021 ◽  
pp. 232949652110246
Author(s):  
Raphaël Charron-Chénier ◽  
Louise Seamster ◽  
Thomas M. Shapiro ◽  
Laura Sullivan
Keyword(s):  
Negative Impact ◽  
The United States ◽  
Policy Outcomes ◽  
Student Debt ◽  
Racial Equity ◽  
Racial Wealth Gap ◽  
Consumer Finances ◽  
Debt Cancellation ◽  
Key Policy ◽  
The Impact

Student debt in the United States has had a disproportionate negative impact on black and Latinx borrowers. We argue that analyses of plans proposing student debt cancellation should therefore foreground their potential impact on racial equity. To do so, we use data from the 2019 Survey of Consumer Finances and model the impact of debt cancellation on four key policy outcomes (reach, impact on the most vulnerable borrowers, borrower wealth gains, and impact on racial wealth gaps). We examine universal policy designs as well as designs that incorporate an income eligibility threshold as a means of targeting benefits toward less affluent borrowers. We find that cancellation amounts ranging from $50,000 to $75,000 yield the most desirable outcomes, especially when paired with a relatively low household income eligibility cutoff at between $100,000 and $150,000. Such policies would cancel roughly half of all outstanding student debt without substantially expanding the racial wealth gap, while still reaching a large majority of borrowers and leading to substantial wealth gains, especially for black households.

Disparate Recoveries: Wealth, Race, and the Working Class after the Great Recession

2021 ◽  
Vol 695 (1) ◽  
pp. 173-192
Author(s):  
Fenaba R. Addo ◽  
William A. Darity
Keyword(s):  
Middle Class ◽  
Working Class ◽  
Great Recession ◽  
Wealth Inequality ◽  
Net Worth ◽  
The Great Recession ◽  
Consumer Finances ◽  
White Working Class ◽  
Using Data ◽  
The Relationship

What does it mean to be working class in a society of extreme racial wealth inequality? Using data from the Survey of Consumer Finances, we investigate the wealth holdings of Black, Latinx, and white working-class households during the post–Great Recession (pre–COVID-19) period that spanned 2010 to 2019. We then explore the relationship between working-class and middle-class attainment using a wealth-based metric. We find that, in terms of their net worth, fewer Black working-class households benefitted from the economic recovery than white working-class households. Among white households, the working class saw the greatest increase in wealth in both absolute and relative terms. Working-class households were less likely to be middle class as defined by their wealth holdings, and Black and Latinx households were also less likely to be middle class. For Black households, racial identity is a stronger predictor of wealth attainment than occupational sector.

Sign in / Sign up

Export Citation Format

Share Document