A study by the Institute on Assets and Social Policy (IASP) found student debt disproportionately affects Black people, leading to the large wealth gap between Black and white people.
The report, authored by Laura Sullivan, Tatjana Meschede, Thomas Shapiro and Fernanda Escobar found that 20 years after starting college, the median debt of white borrowing students had reduced by 94%, while the median Black borrowers had 95% still left to pay.
Though factors like Black applicants facing more discrimination in labor markets and being more likely to support older relatives affect the wealth gap, the hourly income gap between white and Black workers is not nearly as large as the wealth gap. Therefore, though the earnings gap among races is closing, the wealth gap still remains wide.
