Obama Proposal Expands Access To Education For The Unemployed Article

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Obama Proposal Expands Access to Education for the Unemployed

As part of his economic recovery platform, President Obama announced a plan to help ease the nation’s unemployment by making it easier for those without a job to attain a college education.

Author: Vanessa Mchooley

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Obama’s proposal would revise procedural guidelines that often disqualify unemployed workers from obtaining federal Pell grants, low-cost federal student loans, and other government financial aid, stripping away current federal rules that can deter unemployed workers from going back to school for additional training and education.

“In a 21st-century economy where the most valuable skill you can sell is your knowledge, education is the single best bet we can make — not just for our individual success, but for the success of the nation as a whole,” the president said in a speech last May (“Remarks by the President on Job Creation and Job Training,” White House speech transcripts, May 8, 2009).

U.S. employers eliminated 4.2 million jobs in 2009 and sent unemployment soaring into double digits for the first time in more than a quarter century. The official jobless rate has been hovering around 10 percent since the fall of 2009, while the unofficial rate (accounting for the underemployed and those unemployed workers who have given up actively searching for a job) has been over 17 percent.

“Right now, someone who doesn’t have a college degree is more than twice as likely to be unemployed as someone who does,” Obama said, suggesting that higher education may very well be what is needed to help jobless Americans get back on track.

Current Rules Limit Higher Education Options
Chief on the president’s agenda is changing rules that can actually discourage the unemployed “from getting the education or training they need to find and fill the jobs of the future,” Inside Higher Ed reports (“College for the Unemployed,” May 11, 2009).

Currently, some states force jobless workers to give up their unemployment benefits if they enroll in certain kinds of education or training programs, considering them to no longer be searching for a job. Federal financial aid regulations also restrict the unemployed from obtaining federal student aid such as Pell grants and low-interest federal student loans, since college administrators are generally required to use the salary from a student’s former job, as well as any unemployment income, in calculating a student’s financial need and eligibility for college aid.

Without access to federal grants and low-cost federal college loans, the unemployed must often choose between seeking out pricier private student loans to fund their education or simply not returning to school at all.

Private student loans, issued by private lenders rather than by the government, are typically riskier and more expensive than federal student loans, carrying higher, variable interest rates and not offering the borrower benefits provided by federal loans, such as income-based repayment alternatives and the option to defer payments during periods of financial hardship.

But since private student loans are credit-based loans (unlike, for instance, federal Perkins loans and federal Stafford student loans, which require no credit check or a check of income and assets), unemployed workers would likely have difficulty qualifying for a private loan anyway, since they have no job and little or no income.

Changes May Open Doors to College, Jobs
To respond to these challenges, Obama tasked Labor Secretary Hilda Solis with sending a letter to all 50 states, directing them to inform all unemployed workers that they may be eligible for federal financial aid if they return to college or enroll in a training program. The letter also urges states to follow in the footsteps of Maine, which allows recipients of state unemployment assistance to retain their unemployment benefits while enrolled in an approved education or training program.

In early May 2009, Education Secretary Arne Duncan sent a letter to college financial aid officers, encouraging them to expand their use of the “professional judgment” provision, which allows college officials, when appropriate, to adjust a student’s financial aid data to take into account extenuating economic circumstances or changes to the student’s financial situation.

Under this expanded use of the professional judgment provision, colleges would be authorized, by approval of the Education Department, to exclude a student’s unemployment benefits and prior employment income when evaluating that student’s financial need — the student would then generally be eligible for larger amounts of federal grants, need-based federal student loans, and other financial aid.

“Together,” Obama said, “these changes will increase access to education and opportunity for hundreds of thousands of workers who’ve been stung by this recession.”

About Author

Venessa McHooley is an enthusiast on the topic of student loan issues in the news. She has been writing for the past 10 years for a variety of education publications. She now offers his writing services on a freelance basis. http://www.nextstudent.com

Article Source: http://www.1888articles.com/author-vanessa-mchooley-23.html

Obama Proposal Expands Access to Education for the Unemployed