The Student Loan Moratorium: Impact, Affordability, and Return on Investment

In this episode, we delve into the recent decision by the US government to end the moratorium on student loan payments. This decision will have significant implications for millions of Americans who will now have to resume repaying their college debt. We explore the effects of the moratorium and what borrowers did with the extra money during this period.

One key issue we discuss is the rising cost of college education, which has made it increasingly unaffordable for many students. We examine the reasons behind this trend and its impact on access to higher education.

While college graduates, on average, earn higher incomes than high school graduates, we highlight the importance of considering the institution and major when assessing the value of a degree. Some institutions provide little to no earnings premium, and certain majors, such as psychology, communications, and media studies, have lower earning potential.

We also explore the changing landscape of employment and how employers are becoming more open to hiring non-graduates. Many companies are investing in internal training programs to upskill their employees, challenging the traditional notion that a college degree is the only path to success.

Throughout the episode, we emphasize the role that governments can play in providing better information to students about the value of different degrees and regulating universities to ensure quality education. We discuss the importance of individuals carefully considering the cost and potential return on investment when deciding whether to pursue a college degree.

Tune in to this thought-provoking episode as we navigate the complexities of student loans, affordability, and the value of a college education in today's ever-changing world.

Is a college degree worth it? That question hangs over millions of would-be students, as they prepare to apply to university. It is one that many graduates might be mulling over as they have to start paying off their college debts once more. America’s pandemic-era moratorium on student debt payments comes to an end in September. 

On this week’s podcast, hosts Alice Fulwood, Tom Lee-Devlin and Mike Bird examine whether college is still worth the time and the money. Constantine Yannelis from the Chicago Booth School of Business explains how the US economy will be impacted when up to 45 million Americans are confronted with their student debt payments once more. And Michael Itzkowitz, who was appointed to the US Department of Education by former President Obama, reveals how often students fail to earn a return on their investment in education.   

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