Enrollment at for-profit colleges like DeVry and Argosy has risen 225% over the last decade. And the number of critics of the schools is growing almost as fast as the schools themselves. For-profit colleges have been accused of high costs, low graduation rates, and even fraud. A report by the Education Trust proclaimed that the schools deliver “little more than crippling debt.” Are students at these colleges just dupes? Or is it possible that despite the scary stats, these schools are filling a very real need for working parents and low-income students?
For-profit schools, also called private sector colleges or career and technical schools, are run by private, commercial enterprises. They offer degrees and certificates in a wide range of practical subjects like business administration and dental assistance, and like community colleges, they’re set up to accommodate students who have jobs and families. (You don’t seek out a for-profit school to muse about continental philosophy or Victorian literature.) If you see a college advertised on television or on the subway, it’s often for-profit.
In June, the Obama administration cracked down on for-profits by issuing new regulations requiring them to meet certain benchmarks for former students’ loan repayment and career success. The government has continued to exert pressure. Last month, the Justice Department filed a complaint against Education Management Corp., which operates 105 schools under brand names including Art Institute. The government says the company paid recruiters based on the number of students they enrolled, which is a violation of federal law and would make the company ineligible for the billions in state and federal aid it had received over the preceding years.
The industry as a whole has come under serious fire over the last year or so. A Congressional investigation found that more than half of students who enrolled in the 2008-09 school year had withdrawn by the following summer. The investigation also found average tuition is significantly higher at for-profit schools than at community colleges. A report from the Government Accountability Office last year accused the for-profit industry of fraud and questionable marketing practices. The Education Department found that student-loan borrowers at for-profit schools default at more than twice the rate of students at private institutions; though for-profit schools enroll just 10% of higher-education students over-all, they account for almost half of all student loan defaults. And another study, by the nonprofit Institute for Higher Education Policy, found that for every for-profit student who defaults, another two fall behind in payments. (Going into default is the most severe outcome of taking on more student loans than you can afford, but falling behind can carry serious consequences, too.) So is there anything redeeming about for-profit schools?
The elephant in the room is that for-profit schools are designed to serve the poor, minorities, working parents, and other “non-traditional” students — in other words, demographics that traditionally have not success in college. That explains the high drop-out rate, and loan default rates are connected to that. Other statistics show that the schools do a better job than most of connecting poor students with aid. Almost 90% of full-time low-income students at for-profits receive a Pell Grant from the federal program designed to help them; at community colleges, only 61% of similar students tap into that aid.
Angela Harris, an instructor in the pharmacy technology program at a branch of for-profit Anthem College in Phoenix, told me sees a wide variety of students in her classes. “It’s all walks of life,” shes said. “Lots of single moms and dads, students that just got out of high school and just want to find a career ot get them going. … I’ve taught people straight out of high school, and I had a lady in my class who was 65.” She enjoys teaching at Anthem because the classes are small, the teaching is practical, and her students are eager to get ahead. She concedes that some of her students drop out, but most of them eventually return. The kind of students drawn to this kind of practical education aren’t always able to finish in one shot.
Graduating from college is part of the American Dream. In his last State of the Union address, President Obama reiterated his goal that “By the end of the decade, America will once again have the highest proportion of college graduates in the world.” In 2009, he called on every American to go to at least one year of college. Those are high expectations, and they probably make sense in an economy in which there are few high-paying jobs that don’t require a college education. For-profit schools, which have also been on the front lines of online-education innovation, reach into the populations that have traditionally not been able to graduate from college and give them a chance. If we truly want everyone to go to college, not everyone can enjoy four leisurely years on an ivy-strewn campus.