Student Loans and Entrepreneurship: An Overview – Ewing Marion Kauffman Foundation | Kauffman.org

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As 2021 graduates leave academia, many carry the weight of student loans into this pandemic economy, hoping to secure an income that can at least cover student loan payments and rent. Their situation leaves little room to consider the calculated risk and opportunity of entrepreneurship. The relationship between student loan debt and entrepreneurship sits at the intersection of many questions related to labor markets, higher education, business dynamism, innovation, and capital markets. Kauffman’s research brief offers a few key points to consider:
Federal student debt tripled from just over $516 billion in 2007 to $1.5 trillion in 2020.
Nearly 1 in 6 adults in the U.S. has outstanding student loan debt – of those aged 18 to 29, 1 in 3 reported having student loan debt.
The share of new entrepreneurs aged 20-34 declined from 34% to 27% between 1996 and 2019.
This issue brief considers these intersections and asks, “How can student loan debt matter for entrepreneurship?”

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