The resumption of student loan payments after a three-year break, set for October 1, is likely to deliver a blow to American economic growth, according to economists, in a move that could harm many beyond borrowers alone.
Student loan payments were first paused by then-President Donald Trump in March 2020 as a relief measure for borrowers who were financially struggling during the pandemic. The break on payments was then extended nine consecutive times, lasting a total of three years—until now.
"The end of the student loan forbearance risks disrupting an otherwise growing economy," said Hanks. "Wages are outpacing inflation, and unemployment is down, but saddling families with another expensive bill risks undermining our collective economic progress."