The Unacknowledged Value of For-Profit Education

Judah Bellin:

For-profit education is the fastest-growing sector of the higher-education industry. However, politicians and journalists have highlighted trends that they say should make students think twice before attending for-profit colleges. These include:

Poor graduation rates, as only 22 percent of students at for-profits completed college in six years, compared with 65 percent of students at nonprofit private schools and 55 percent of students at nonprofit public schools;

Higher loan-default rates, as 25 percent of students at for-profits default on their loans--the figures for their peers at nonprofit private and public schools are 7.6 and 10.8 percent, respectively;

Higher likelihood of unemployment for alumni of for-profit colleges.

However, policymakers should not overlook the many positive aspects of for-profit colleges. For-profits are notable for educating students who are underrepresented at traditional campuses. For instance:

African-Americans and Hispanics constitute 22 and 15 percent of students in the for-profit sector, respectively, though they make up only 13 and 11.5 percent of all students;

75 percent of students attending for-profits are financially independent;

54 percent of dependent students attending for-profits have incomes below $40,000;

65 percent of students attending for-profits are aged 25 and older, compared with much smaller percentages at four-year public colleges and two-year colleges.

Posted by Jim Zellmer at April 20, 2013 2:30 AM
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