Going for broke

Students working, borrowing more to afford education

Tannara Yelland
CUP Prairies and Northern Bureau Chief

SASKATOON (CUP) — Louis’ Pub may be known by name only to students at the University of Saskatchewan, but the idea is universally recognizable: The campus restaurant or bar is a time-honoured staple of university life.
Inside, students participate in another tradition. During the pre-supper hours when students are finishing classes and dropping in for a beer, four servers rush between tables, the kitchen and the bar, most of them students themselves.
They are working to pay for all or part of the expenses they acquire as students, from tuition to rent to – for many of them – beer.

One such server agreed to take a few minutes off between cleaning tables and taking payments to discuss her busy schedule.
Erika Klassen has been working since she came back to school two years ago. The third-year linguistics major entered university right out of school, but decided to leave and “take a few years off.”

When she came back in the fall of 2009, she began working at Louis’. Klassen said she works about 20 hours each week in addition to taking four classes.

When asked if she ever finds it difficult to balance school with work and the rest of her life, Klassen laughed and said, “Oh, yeah. For sure.”

One possible benefit for Klassen is that working at the campus bar may allow her to feel social while paying the bills. Unfortunately, she can’t do her homework at work.

Student employment has increased over time from just under 30 per cent in 1979-80 to a high of almost 50 per cent in 2007-08. Students are overwhelmingly employed in the service sector – 96 per cent of post-secondary students find work there, as opposed to 78 per cent of the total Canadian work force.

Their work in the service sector may explain why student employment took a bigger hit than most demographics during the recent recession. Statistics Canada says that “between October 2008 and October 2009, employment declined by about 10 per cent among those aged 15 to 24.”

That’s a loss of 225,000 jobs, which is more than half the jobs Canada shed in that time. Each one per cent increase in student unemployment represents a six per cent increase in student loan borrowers.

While the number of students working during school has increased, the number of students on government assistance has also gone up. Part of the reason for this likely lies in the fact that tuition fees have, on average, risen higher than the rate of inflation since the early 1990s.

In 1995, about 50 per cent of students had loans from either private firms or the government. By 2005, that number had gone up to nearly 60 per cent, and the number of those students who were looking to private businesses for assistance had increased significantly. While 70 per cent of the loans obtained in 1995 were from the government, the split is now almost even.

Third-year U of S science student Andrew Warren is financing the entirety of his education with government student loans.
Despite the fact that he will incur significant debt while he attends school, Warren said he is not concerned about repaying it when the time comes.

“They’re government loans,” he said. “So the repayments aren’t tremendously steep, and there are grants and subsidies to help take care of the costs.

“Also, [there are] benefits for staying in the province to work afterwards.”

Students who obtain their loans through the Canadian government can apply for up to 54 months of interest relief and other repayment assistance programs.

In Saskatchewan, the Graduate Retention Program was instituted as a way to entice students not to leave the province after graduating. Graduates are issued a GRP certificate, which must be submitted with their Saskatchewan income tax, along with the amount of tuition to be paid.

Graduates in Manitoba are eligible for a tax rebate as well. Manitoba does not require students to have graduated there to qualify.

While students today scramble to fit both work and school into their schedules, or gather debts in the tens of thousands, there are some new options for the children of the next generation.

One such option is the Canada Learning Bond, which allows low-income parents – those who are eligible for the National Child Benefit Supplement – to set up a Registered Education Savings Plan that the Canadian government will contribute to whether the parents do or not.

With a traditional RESP, the government matches what parents put in up to $7,000. If parents apply for a CLB, the Canadian government puts $500 into an RESP upfront and $100 each year after that until the child is 15. The CLB is available for children born on or after Jan. 1, 2004.