Daily Business Briefing
Aug. 6, 2021, 11:52 p.m. ET
Aug. 6, 2021, 11:52 p.m. ET
Monday
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Job openings: Data from the Labor Department will show whether job openings in the U.S. continued to rise in June. Economists will learn whether the reopening of the economy is creating more demand for workers.
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Climate change: The Intergovernmental Panel on Climate Change, an entity within the United Nations, will release the first installment of a report that represents the global consensus on human-caused climate change.
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AMC earnings: The movie theater chain, with a wild ride during the pandemic that culminated in its stock tripling in a trading frenzy, will report its financial performance for the three months ending June 30. Will theater reopenings help it find a profit?
Tuesday
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Coinbase earnings: The cryptocurrency exchange will report its financial performance. The company’s share price has fallen 32 percent from where it started trading earlier this year, following a broad cryptocurrency sell-off.
Wednesday
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Consumer Price Index: Economists expect the index, a closely watched measure of inflation, to show that pandemic-driven price increases continued in July.
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Lordstown earnings: The struggling company, which aims to make electric pickup trucks, is set to publish its results for the second quarter. Its founder, Steve Burns, resigned as chief executive in June after claims that he overstated interest from commercial buyers in its electric truck.
Thursday
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United Kingdom G.D.P.: The Office for National Statistics is set to publish the U.K.’s gross domestic product estimates for the three months through June, covering when the country started to emerge from its winter lockdown.
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Disney earnings: Investors will be watching whether the immediate availability of “Black Widow,” “Luca,” “Cruella” on the company’s Disney+ streaming platform helped to drive sign-ups during the second quarter. In the first three months of the year, they were lower than Wall Street had expected.
United Airlines said on Friday that it would require all U.S. employees to be vaccinated against the coronavirus starting this fall. It was the first major airline to establish such a mandate and the latest in a small but growing number of businesses to do so.
Also on Friday, Amazon, the second-largest private employer in the country, and JPMorgan Chase revived mask mandates for vaccinated workers.
“We hope this will only be required for a few weeks,” Amazon, which had been allowing vaccinated employees to go without face coverings, wrote to its warehouse workers on Friday. “Everyone can do their part to speed our return to normal by getting vaccinated.”
JPMorgan, the nation’s largest bank, said unvaccinated employees must be tested at least twice a week and would not be allowed to attend indoor employee events with 25 or more people. The company’s operating committee also said in a memo that the firm “will continue with our previously stated return to the office schedule,” even as many companies, including the financial firms BlackRock and Wells Fargo, have postponed their mandatory return plans.
Amazon had already told its corporate employees that they wouldn’t be recalled to the office until January, pushing back a deadline that had been set for early September. But it has not indicated any changes to its vaccination policy, which encourages but does not mandate immunization.
Hours after United’s announcement, Frontier Airlines, a much smaller carrier, said it, too, would require vaccines for all employees. Frontier’s mandate begins on Oct. 1.
United’s employees will be required to upload proof of vaccination within five weeks of a vaccine’s full approval by the Food and Drug Administration (not the Federal Drug Administration as was reported here earlier) or by Oct. 25, whichever comes first. Those who provide proof by Sept. 20 will receive a full day’s pay, excluding pilots and flight attendants who have already received a union-negotiated bonus for getting vaccinated. So far, about 90 percent of United’s pilots and 80 percent of its flight attendants have been vaccinated, the airline said.
“We have no greater responsibility to you and your colleagues than to ensure your safety when you’re at work, and the facts are crystal clear: Everyone is safer when everyone is vaccinated,” Scott Kirby, the airline’s chief executive, and Brett Hart, its president, said in a memo to their staff.
Employees who fail to comply with the new policy will be fired. And while United will allow exceptions for religious or medical reasons, it will require documentation.
Mr. Kirby first floated the idea of a mandate at an internal forum in January, saying United would be “amongst the first wave of companies” to require vaccination.
Delta Air Lines requires new employees to be vaccinated, but existing employees are exempt. American Airlines is “not putting mandates in place” for employees or customers, its chief executive, Doug Parker, said in an interview with the New York Times columnist Kara Swisher.
Airlines have generally dismissed the idea of mandates for customers. Mr. Parker said in the interview that doing so would create “enormous delays.” Delta’s chief executive, Ed Bastian, said on CNBC this week that it would be “very difficult” to require customers to receive a vaccine that hadn’t yet been fully federally approved.
Lananh Nguyen and Karen Weise contributed reporting.
Even though hiring surged last month, the sectors where the most growth occurred are especially vulnerable to the Delta variant of the coronavirus, highlighting the recovery’s fragility.
Leisure and hospitality businesses, which were devastated in the months after the pandemic struck as bars and restaurants closed, led the way among industries, with a gain of 380,000, while education employment by local governments jumped by 221,000.
Should restrictions on dining return, or schools close again, these sectors would be hard hit. The travel industry, too, would probably see a downturn in hiring if cases spike further.
“If Delta becomes a concern, it will likely constrain spending and activity and potentially hiring in all of the same service sectors,” said Michael Gapen, chief U.S. economist at Barclays. “It does present some downside risk.”
Already, events like the New York International Auto Show, which was to have opened later this month in Manhattan, have been canceled. Mask requirements have been reintroduced indoors in many areas as well.
Still, it’s too soon to see much impact in the data for consumer activity or weekly jobless claims that have come out since the variant became widespread. What’s more, most economists, including Mr. Gapen, remain sanguine about the jobs picture, despite Delta.
Broader economic fundamentals are moving in the right direction, with a robust housing market and strong earnings reports on Wall Street.
At the same time, some areas that are less sensitive to the spread of the virus showed signs of growth last month, which also bodes well. Employment in transportation and warehousing jumped by nearly 50,000, while jobs in health care and social assistance showed a 46,800 gain.
“The labor market in the U.S. is very strong,” Mr. Gapen said. “Unemployment benefits, infection risks and child care constraints are not preventing robust hiring.” Indeed, the labor force — people currently working or actively looking for work — grew by 261,000 last month, a sign that more people are gradually coming off the sidelines in search of work.
Federal Reserve officials are trying to decide what comes next for monetary policy, and Friday’s jobs report gave them a positive sign that the economy is moving toward their goals.
The July employment report — which showed that the country added 943,000 jobs as wages rose and more people in their prime working years joined the labor market — is likely to increase the central bank’s confidence that the economy is swiftly healing.
The Fed has held interest rates near zero since March 2020 and is buying a lot of bonds each month, policies meant to keep near-term and longer-term interest rates low, fueling borrowing and spending. As officials consider when and how to slow their bond buying, the first step toward reducing their support for the economy, they are closely attuned to job growth.
Fed policymakers have two main goals: They want inflation that comes in at a slow but steady 2 percent yearly rate on average over time, and they want to guide the economy toward maximum employment. While prices have moved sharply higher this year, central bankers have been looking for more progress on the jobs front.
The solid employment gains in July are probably right in line with what they are hoping to see in order to put them on track for announcing a plan to slow bond-buying in the coming months. One official, Christopher J. Waller, a member of the Fed’s Board of Governors, recently signaled that he was looking for and expecting job gains around 800,000 to one million per month.
“Today’s number should keep November in play” for the Fed to announce plans to slow its purchases, Michael Feroli at J.P. Morgan wrote in a note after the release. Many economists expect the central bank to announce the so-called taper in late 2021, and to start to slow bond buying at the end of this year or early next.
Jerome H. Powell, the Fed chair, has said the central bank is monitoring factors like the overall unemployment rate, the jobless rate for different demographic groups, labor force participation rates and wage data to get a holistic picture of whether the economy is moving back to full employment.
“We have some ground to cover on the labor market side,” Mr. Powell said in late July, explaining that the job situation needed to heal more before the economy would have shown enough progress for the Fed to announce that it would slow bond buying. “I would want to see some strong job numbers.”
Here are a few of those broader metrics of labor market strength in July:
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The unemployment rate for Black workers fell to 8.2 percent from 9.2 percent, and that for Hispanic workers fell to 6.6 percent from 7.4 percent. Minority groups often see joblessness spike highest, and then remain stubbornly elevated, during and after downturns. Improvement along those metrics can be a sign that the labor market improvement is reaching a broad swath of people.
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The participation rate for workers in their prime working-age years, which is defined as 25 to 54, rose to 81.8 percent from 81.7 percent. The Fed is hoping to see that figure climb back toward its February 2020 level, which was 82.9 percent.
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The employment-to-population ratio, a measure of the share of the adult population with jobs, rose to 58.4 percent from 58 percent the prior month. That gauge has recovered nearly three-quarters of its pandemic losses. The measure for prime-age workers is also recovering, and is back to 2016 levels.
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Average hourly earnings rose 4 percent from a year earlier, slightly more than the 3.9 percent expected in a Bloomberg survey, and wages for nonsupervisory and production workers — which can give a clearer reading on what’s happening for typical workers — have climbed by 4.7 percent over the past year. Those wage data have been distorted by who has and hasn’t returned to the job market over the course of the pandemic, but they are pointed in the right direction, from the Fed’s perspective.
Washington has been preoccupied by infrastructure this week, but officials still found time to take aim at the cryptocurrency industry. It’s a sign of the industry’s increasing prominence, the DealBook newsletter reports.
Gary Gensler, the chair of the Securities and Exchange Commission, Senator Elizabeth Warren, Democrat of Massachusetts, and others have been calling for stricter regulation of digital assets. Cracking down on cryptocurrency also came up in negotiations over the infrastructure bill, which includes a provision to raise about $30 billion in taxes on crypto transactions over a decade.
On that front, the crypto industry’s growing lobby rallied to press senators for an amendment to clarify the provision, showing its sway. The venture capitalists at Andreessen Horowitz wrote to Senate leaders, calling the clause “overly broad” and suggesting a lawsuit looms if the language isn’t changed. Brian Armstrong, the chief executive of the cryptocurrency exchange Coinbase, protested in a Twitter thread. And lobbyists worked behind the scenes with a bipartisan group of senators on an amendment that is now set to be considered before the bill goes to a vote.
This skirmish is a preview of bigger battles to come. In addition to Mr. Gensler and Ms. Warren, the leaders of the House Financial Services Committee and the Senate Banking Committee have called for sweeping new rules for digital assets and tougher enforcement. Representative Donald Beyer, Democrat of Virginia, recently introduced a comprehensive bill on digital assets that industry groups told DealBook they haven’t had time to analyze yet because of the infrastructure proposal fight. After mounting such resistance to one provision in a 2,700-page bill, more protracted fights lie ahead, which will test the strength of the crypto industry and may create rifts among officials.
At the Federal Reserve, policymakers appear increasingly conflicted over digital dollars. Recent speeches show that they have yet to align on the costs and benefits of a state-issued digital currency, even as counterparts in China, parts of Europe and smaller economies like the Bahamas have or are working on one. The Fed plans to release a report on the topic later this summer, which is sure to generate debate.
Chris Cuomo is set to begin a weeklong vacation from his prime-time CNN talk show on Friday, a break that the host described as a previously scheduled absence planned around his birthday.
“Every year I take my birthday week off,” Mr. Cuomo, who will turn 51 on Monday, said on a CNN podcast. “I’m looking forward to it.”
The vacation comes as Mr. Cuomo’s brother, Gov. Andrew M. Cuomo of New York, faces widespread calls to resign after a report by the New York State attorney general on Tuesday detailed multiple sexual harassment accusations against him.
Chris Cuomo has not once mentioned his brother or the scandal on his 9 p.m. program since the release of the report, which has otherwise received extensive coverage on CNN. He apologized earlier this year for discussing strategy with Governor Cuomo’s aides on how to respond to the scandal; the host called his actions a “mistake” and pledged not to discuss his brother on-air.
On Thursday’s episode of “The Handoff” — a weekly podcast that Chris Cuomo co-hosts with his network colleague Don Lemon — Mr. Cuomo told Mr. Lemon that he was looking forward to his time away.
“I’ll be right here at home because I don’t know why I’d go anywhere else than the East End of Long Island during the summer. It’s the most beautiful place in the world,” said Mr. Cuomo, who is a fixture of the Hamptons summer scene, along with Mr. Lemon. “I’ll be fishing, I’ll be hanging out with you, and I’ll be making memories with the kids.”
Mr. Lemon said he was “cooking up” plans for the week with Mr. Cuomo’s wife, Cristina.
“I’m sure you’ll make the plan and I’ll pay for it,” Mr. Cuomo joked.
The ongoing scandal involving Governor Cuomo went unmentioned.
Michael Smerconish, a regular substitute for Chris Cuomo, is scheduled to host Friday’s edition of “Cuomo Prime Time.” Chris Cuomo also did not appear on the Friday episode of his SiriusXM radio show; a substitute host said he was on vacation. CNN declined to comment beyond Mr. Cuomo’s comments on his podcast.
The Federal Reserve has lifted restrictions on JPMorgan Chase for its role in rigging foreign exchange rates between 2008 to 2013.
The Fed, which among its responsibilities helps to regulate banks, ended a 2015 enforcement order against JPMorgan for “unsafe and unsound banking practices,” such as coordinating trades with other banks via chat rooms and sharing confidential customer information, the Fed said in a statement Thursday. At the time of the order, authorities also fined JPMorgan $342 million and instructed it to improve oversight and controls.
The end of JPMorgan’s regulatory punishment closes a chapter in the fixing scandal, even as potential class-action lawsuits loom for banks accused of colluding to rig benchmark exchange rates. Global banks, including Citigroup, JPMorgan, Barclays, The Royal Bank of Scotland and UBS, have paid more than $10 billion in fines and settlements in the wake of the scandal. The market for currencies, in which $6.6 trillion changes hands daily, is the largest in the world.
Last year, a former JPMorgan trader, Akshay Aiyer, was sentenced to eight months in prison for his role in bid rigging. Richard Usher, another former trader at JPMorgan, was acquitted in 2018, alongside former bankers at Citigroup and Barclays who were accused of belonging to a group known as “the Cartel.”
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Yields on government bonds rose on Friday after the Labor Department said U.S. employers added 943,000 jobs in July, beating expectations of a gain of 870,000 positions.
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The government also revised higher the data for two previous months by 119,000 jobs. The unemployment rate dropped to 5.4 percent from 5.9 percent in June.
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That said, the data was collected in the first half of July, before variant-related cases surged and businesses and states reintroduced mask mandates and other restrictions.
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Yields on 10-year U.S. Treasury notes climbed to 1.31 percent, from 1.23 percent. Signs of strength in the economy could keep the Federal Reserve on track to start to pull back its support for the economy — namely its purchases of government bonds.
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The report “highlights a roaring recovery in the labor market and increases the chances of the Fed tapering their asset purchases sooner rather than later,” Mike Bell, a strategist at JPMorgan Asset Management, wrote in a note. “We expect this to be the start of a sustained move higher in treasury yields over the rest of the year.”
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Gains in the stock market were muted. The S&P 500 rose about 0.2 percent, while the Nasdaq composite fell about 0.4 percent.
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European stock indexes were mostly higher. The Euro Stoxx 50, made up of the eurozone’s largest public companies, rose 0.3 percent.
A vintage Super Mario Bros. video game has sold for $2 million, a collectibles company announced Friday, breaking the record for the most expensive video game sale that was set just weeks ago.
The 1985 game, made for Nintendo’s original console, has never been opened — a rarity for old video games, said Rob Petrozzo, one of the founders of the collectibles site, Rally. An anonymous buyer purchased it, he said.
Demand for collectibles has surged during the pandemic, along with many other forms of investment, as people stuck at home look for ways to spend their money. People have spent millions of dollars for pieces of digital artwork — known as nonfungible tokens — like internet memes and video highlights of National Basketball Association players. Physical goods, including old cars and sports cards, have soared in value over the last year, too.
But video games are still a nascent market, Mr. Petrozzo said. Interest in buying old games has picked up some in recent years, but many vintage games have been opened and played, causing them to lose value, he said, and investors are often intimidated from entering an industry they’re unfamiliar with.
Recently, though, a pair of head-turning sales have jolted interest in the gaming space. A 1987 Legend of Zelda game cartridge that sold for $870,000 in early July was considered a record, until a 1996 Super Mario 64 game went for $1.56 million just days later.
“I think that we’re starting to see the natural progression of ‘What else? What are the things that have appreciated in value from my childhood that have that nostalgia?’” Mr. Petrozzo said.
The past two record sales were made via an auction. Rally uses a different system. The company buys physical collectibles, like comic books and cars, and invites people to invest in shares of the individual items as they would a stock. When someone makes an offer to buy one of the items outright, Rally takes that offer to the investors, who vote on whether to sell and cash out their share of the profits, or to decline.
Rally bought the Super Mario Bros. game for $140,000 in April 2020, and investors shot down a $300,000 offer for it last year. The $2 million offer from the anonymous buyer — a collector who is “making big bets in the video game space” — won the approval of three-fourths of the game’s investors, Mr. Petrozzo said.
Ed Converse, a graduate law student from Green Bay, Wis., invested $100 in the game last year and said he was netting $950 from the sale.
“I’m very excited about it,” Mr. Converse, 32, said. “It’s pretty crazy to think that I made an investment in it because of the nostalgia of playing the video game when I was a kid and now it’s selling for $2 million.”
Mr. Petrozzo thought that the splashy sale could be just the beginning for gaming collectors.
“In my opinion, it hasn’t reached the masses,” he said. “You’ll start to see a lot more people paying attention and doing research.”
Sales are falling fast at Huawei, the Chinese tech titan that American officials have deemed a national security threat and sought doggedly to undermine.
The company said on Friday that its shrinking smartphone business caused overall revenue for the first half of the year to slide by nearly 30 percent from last year, to about $50 billion. Its net profit margin, however, was 9.8 percent, up from 9.2 percent last year.
As a closely held company, Huawei is not legally obligated to report its earnings. It publishes only a small selection of financial results, and not on a quarterly basis.
“Our aim is to survive, and to do so sustainably,” Eric Xu, one of Huawei’s deputy chairmen, said in a statement on Friday.
Over the past few years, Huawei’s ability to work with the international computer chip industry has narrowed because of a series of rules that were imposed by the Trump administration. It has become extremely hard for the company to produce the cutting-edge phones that had made it a global Goliath not long ago. Huawei denies that its products threaten any nation’s security.
The U.S. sanctions also prevent Huawei devices from running Google’s most popular apps. That has been driving away customers outside of China for awhile.
But even within China, where many Google apps have long been blocked, Huawei’s handset business is sinking quickly. In the latest quarter, for the first time in over seven years, Huawei was not one of China’s five best-selling phone brands, according to the market research firm Canalys. The top five, in order, were Vivo, Oppo, Xiaomi, Apple and Honor.
Honor had been a Huawei brand until it was spun out late last year to put it out of reach of the U.S. restrictions. That contributed to the drop in Huawei’s smartphone revenue, a company spokesman said.
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Levi Strauss & Co. said on Thursday that it agreed to buy the Beyond Yoga brand, highlighting the powerful lure of athleisure in the modern day. The company said that it expected the deal to add more than $100 million to net sales in fiscal 2022. Terms of the deal were not disclosed.
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The White House said on Thursday that it was aiming for half of all new vehicles sold by 2030 to be electric powered, portraying the shift to battery power as essential to keep pace with China and to fight climate change.
President Biden announced the target on Thursday as part of a plan that will also include construction of a nationwide network of charging stations, financial incentives for consumers to buy electric cars, and financial aid for carmakers and suppliers to retool factories for electric vehicles.
Many parents of young children — those under 12 who cannot yet be vaccinated — say they’re unable to return to workplaces or apply for new jobs as long as there is uncertainty about when their children can safely return to full-time school or child care, reports Claire Cain Miller, a correspondent covering gender, families and the future of work for The Upshot.
“You cannot divorce the child care issue and the pandemic,” said AnnElizabeth Konkel, an economist at the Indeed Hiring Lab. “It’s important that we don’t forget about the workers who are wrestling with this day in and day out.”
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In an Indeed survey this summer, a significant share of those looking for a job said they were waiting for schools to open. Among those who were unemployed but not urgently looking, nearly one-fifth said care responsibilities were the reason. Those without college degrees were more likely to cite such a reason — and more likely to be unable to work from home or to afford nannies.
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Many parents of preschool-aged children face a shortage of child care openings. One-third of child care centers never reopened, research shows; those that are still closed disproportionately served Asian, Latino and Black families. Those that opened are operating at 70 percent capacity, on average. They have struggled to hire qualified teachers; must keep classes small to limit exposure to the virus; and have raised prices to cover new health and cleaning measures.
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Fall is looking increasingly uncertain. Some workplaces have paused reopening plans because of Delta, and parents worry schools may follow. Certain companies, including McDonald’s, and states, like Illinois, are trying to get ahead of this by offering child care benefits to help parents get back to work. According to Bright Horizons, the employer-based child care company, 75 companies have started offering backup child care this calendar year and others, like PayPal, have extended their pandemic expanded benefits through this year.
Hybrid work could introduce a new type of inequality to the workplace: Bias against remote workers could become a new obstacle to making workplaces more diverse and inclusive, say management experts and corporate executives themselves, Sarah Kessler reports for DealBook.
Though most evidence that remote workers are at a disadvantage is anecdotal, at least one study, led by researchers at Stanford University, suggests they are less likely to be promoted than their in-office peers. In the experiment, researchers randomly assigned workers at a large travel agency in Shanghai to work remotely or in the office for nine months. Though the remote workers were 13 percent more productive, putting in more hours and making more calls per minute, they were promoted about half as often as their in-office peers.
“They can get forgotten,” said Nicholas Bloom, a professor of economics at Stanford and one of the study’s authors.
The result is troubling partly because the desire to work remotely isn’t evenly distributed, Dr. Bloom said. He and his research team conducted monthly surveys about remote work since May last year. As of March this year, among college-educated parents of young children, women have said they want to work from home full time around 50 percent more often than men do.
WASHINGTON — The Education Department announced Friday that it would continue a moratorium on federal student loan payments through Jan. 31, extending emergency relief for millions of borrowers that had been set to expire next month.
The department said that this would be the “final extension” of the pause, which the Trump administration instituted in March 2020 at the outset of the coronavirus pandemic, and that the additional time would allow the agency to transition borrowers back into repayment and reduce the risk of default and delinquency. More than 40 million borrowers have federally held loans, and during the moratorium, they have been interest-free and not subject to repayment or penalties for nonpayment.
“The payment pause has been a lifeline that allowed millions of Americans to focus on their families, health and finances instead of student loans during the national emergency,” Education Secretary Miguel A. Cardona said in a statement. “As our nation’s economy continues to recover from a deep hole, this final extension will give students and borrowers the time they need” to plan to resume payments.
Several Democratic leaders in Congress had pressed the Biden administration over the summer to continue the student loan pause, saying that the fast-approaching expiration was ill timed considering that millions were still suffering financial hardship from the pandemic.
“Since the beginning of the Covid-19 pandemic, millions of Americans have struggled to keep a roof over their heads, pay bills and put food on the table,” the heads of the Senate and House Education Committees, Senator Patty Murray of Washington and Representative Robert C. Scott of Virginia, wrote in a June letter. “While the economy has begun to show promising signs of recovery, more than nine million Americans remain out of work, and the economic and health disparities created by the pandemic are severe.”
They also wrote that the pause had helped borrowers “cover essential expenses during the pandemic and during ongoing recovery efforts.”
The Federal Reserve Bank of New York estimated that the pause had saved borrowers $7 billion per month in payments during the pandemic, according to the letter from Ms. Murray and Mr. Scott, and the Education Department estimated that borrowers saved about $5 billion per month on loan interest.
Senator Richard M. Burr of North Carolina, who is the top Republican on the Senate Education Committee and co-wrote a June letter opposing an extension, said there was “no rational excuse” for another extension, which he said would cost an estimated $20 billion on top of $76 billion already spent.
“As vaccination rates continue to increase, Americans are returning to work and returning to their normal daily lives,” Mr. Burr said in a statement Friday. “Student loan repayments should resume as well.”
In a statement, President Biden said the current jobs numbers showed that “we have the tools that will allow us to beat Covid-19 and keep our economy recovering at a record rate.” But he added, “We know there is more work to do, and the road will still be long for many people — especially for the one in six adults and one in three young people who have federal student loans.”
Notably, the Education Department emphasized that January was a “definitive end date” — this will be the fourth extension since the pandemic began — as the Biden administration faces mounting pressure from Democrats to erase up to $50,000 in federal student loan debt.
An official familiar with the department’s plans said that the January expiration date was based on financial aid cycles and delinquency patterns, and that the emphasis on its finality was intended to give borrowers more certainty than the rolling extensions have provided. The department is also preparing for the departure of major loan servicers — including the Pennsylvania Higher Education Assistance Agency, known as PHEAA, which handles millions of accounts — and will use the four months to transition.
The announcement drew cheers from advocates for student borrowers.
Persis Yu, the director of National Consumer Law Center’s Student Loan Borrower Assistance Project, said there were “too many moving parts to successfully start federal student loan repayment,” citing the loan servicer shake-up.
“Borrowers are collectively taking a huge sigh of relief at the news that the federal student loan payment pause has been extended once again,” Ms. Yu said in a statement. “The student loan system is not ready to resume repayment on Oct. 1, and President Biden has made the right decision to postpone repayment.”
The extension is likely to amplify calls for the Biden administration to cancel student loan debt outright.
In a joint statement, Senator Chuck Schumer of New York, the majority leader, Senator Elizabeth Warren of Massachusetts and Representative Ayanna Pressley of Massachusetts — all Democrats who have urged Mr. Biden to cancel student loan debt by executive order — said the pause “provided an enormous relief to millions of borrowers facing a disastrous financial cliff” but did not go far enough.
“Our broken student loan system continues to exacerbate racial wealth gaps and hold back our entire economy,” the statement said. “Student debt cancellation is one of the most significant actions that President Biden can take right now to build a more just economy and address racial inequity. We look forward to hearing the administration’s next steps to address the student debt crisis.”