for-profit colleges
Researchers say a new classification system is needed to help students choose the colleges that will serve them well. Credit: John O’Boyle for the Hechinger Report

We haven’t missed any headlines on college enrollment trends during the Covid-19 pandemic. Among the most alarming stories are reports of a overall decline in college enrollment and a much more pronounced drop in community college enrollment.

But for-profit college enrollment is on the rise – 5.3% increase from fall 2019 to fall 2020.

This growth is concerning when you consider what happened after the Great Recession. Those years also saw an increase in the number of students attending for-profit colleges, but those students were more likely to drop out, end up with low-paying jobs, and find themselves unable to repay their student loans.

Between 2007 and 2011, black and Hispanic undergraduate enrollment in for-profit four-year colleges almost doubled. But the graduation rates of blacks and Hispanics in for-profit institutions were roughly 30 percentage points lower than in non-profit institutions. And more often than not, for-profit institutions have failed to deliver adequate outcomes for their students.

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We analyzed data from the College Scorecard and found that students from low-income households who entered for-profit institutions in 2007 or 2008 earned less than $ 25,000 per year, on average, as of 2015. C is significantly less than students who attended public or private. non-profit colleges. With this income disparity, unsurprisingly, low-income students who graduated from for-profit colleges had a harder time repaying their loans than low-income students who attended non-profit colleges. Among for-profit students who started repaying student loans between 2009 and 2014, less than 25% were able to start repaying their loan principal within three years.

This week, we joined forces with the association Third way to release a report which offers a new classification system to understand how well colleges and universities serve their students. We have grouped over 1,500 institutions into four categories based on their net tuition fees and the ability of their students to repay their loans; low-cost, low-quality institutions are on one end of the spectrum, and low-cost, high-quality colleges are on the other end.

No student should be worse off after going to college than if they had never attended.

Expensive, low-quality institutions charge above-average prices for below-average results and are the worst offenders in higher education. We ranked 12% of private, non-profit four-year colleges and 2.5% of public four-year colleges as high-priced, low-quality – and nearly 80% of four-year for-profit colleges. like high price and low quality. establishments.

Simply put, this is a matter of fairness. For-profit colleges – which are overrepresented among high-priced, low-quality institutions – are much more likely to recruit and enroll students of color and low-income students, raising the stakes of how they serve these populations. The Covid-19 pandemic has exacerbated the equity gap in higher education in devastating ways, and we cannot afford to sit idly by. Federal policymakers must act to protect low-income students and students of color from expensive, shoddy schools.

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This new classification system can be a tool to hold all institutions – nonprofit, for profit or public – accountable for how they serve their students. The federal government could restrict access to Title IV financial assistance for expensive, low-quality institutions that do not improve over time and invest more in low-cost, high-quality institutions, many of which are four-year-old public schools that may face funding cuts as states grapple with the aftermath of the Covid-19 pandemic. Policymakers could also use the system to reinstate or reinvent accountability measures, like the paid employment rule, designed to ensure colleges don’t leave students worse off than they were before they enrolled.

This classification system could also help students choose the colleges from which they are most likely to graduate and earn a living. To improve transparency for students and families, we propose to formally identify high-priced and low-quality institutions with an “HPLQ” indicator in the college scorecard and other consumer tools.

Higher education can profoundly improve the lives of students. But the benefits of going to college are not universally felt. And while expensive, low-quality institutions increase access by enrolling a disproportionate share of low-income students and students of color, these colleges often provide access to poor performance and crippling debt.

No student should be worse off after going to college than if they had never attended at all. Policymakers must take bold steps to improve transparency for prospective students and increase accountability for expensive, low-quality institutions that do more harm than good.

Justin Ortagus is an assistant professor of higher education administration and policy at the University of Florida, and Rodney Hughes is an assistant professor of higher education at the University of West Virginia.

This story of for-profit colleges was produced by The Hechinger report, an independent, non-profit news organization focused on inequalities and innovation in education. Sign up for The Hechinger newsletter.

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