Credit Business

The largest sector of growth in this category was student loans and automobile purchases, which saw a $10 billion increase from the previous month. A measurement of total credit card debt, however, was shown to have shrunk by nearly $2 billion, making this month’s number ($846 billion) close to 20% below the highest rate of just over $1 trillion in July 2008.

Some economists are saying that a big contributor to this trend is the increase in US payroll taxes that took effect on January 1. As a result of a 2009 tax cut expiring, income taxes for all Americans increased by two percentage points. While in the past many Americans are quick to use credit cards to cover expenses, that phenomenon has ceased to exist in the years following the recession. The reduction of household debt