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Early this month, the Obama administration announced new steps at regulating for-profit, vocational, and career college programs. The colleges must show improvement in the education students receive, or they will become ineligible for federal student aid.
For-profit and career colleges have grown tremendously, both in student numbers and profits. The enrollment at for-profit colleges jumped in just a few short years from 365,000 to 1.8 million, reported the Government Accountability Office (GAO).
Many for-profit colleges align their growth with a statement from President Barack Obama on higher education. Obama stated, “America will regain its lost ground and have the highest proportion of students graduating from college in the world by 2020.”
A substantial number of for-profit colleges do not give tuition costs, loan repayment plans, and graduation rates to students during the admission process. Under gainful employment regulations, colleges are required to give students this important consumer information so students can make the best higher education choice.
Pauline Abernathy, a vice president at the College Institute of Access & Success, said “The new regulations on higher education are a good step in the right direction,” in a phone interview. But she said more needs to be done. “One of which is ensuring that the program itself is of sufficient quality for preparing students for jobs that actually exist in the market place.”
The youth unemployment rate in the United States is at a high, making it hard for many students to afford higher education. The Bureau of Labor Statistics (BLS) Employment Household data for May 2011 shows youth experienced the highest unemployment rates of all Americans at 24.2 percent.
Many unemployed youth are left to take out student loans for a college education. In a job market with few prospects for our youth, are for-profit colleges asking too much in tuition? Are we to have the largest population educated in 2020 at the cost of high student debt?
Some students who attend these colleges end up shouldering a large amount of student loan debt and yet have an ineffective college education for employment after graduation. In 2009, students at for-profit colleges received more than $4 billion in Pell Grants and more than $20 billion in federal loans provided by the Department of Education, stated a report from GAO.
The BLS data also showed that the higher the education a person received, the lower the unemployment rate. For-profit colleges admit in promotional commercials that many of their graduates are first-generation graduates, meaning the parents of the students do not have a college education. Such families are likely to have lower incomes and have more difficulty paying off the student loans.
Iowa Sen. Tom Harkin wrote in an online report, “Not all for-profit schools are quality educational institutions, and some appear to be nothing more than highly efficient government subsidy collectors.”Beginning July 1, 2012, colleges will be required to send specific data to the Department of Education (DOE) about student costs, job placement, and more. Sara Ghast, spokeswoman for the Department of Education, said in a phone interview, “We will be able to get a better picture about who the bad actors are and what programs are not doing their job at preparing students for gainful employment.”
