New Report Attempts to Bring Transparency to For-Profit Colleges
Youth Today, a trade publication for youth service professionals, released an intensive report on for-profit colleges that attempts to do something that for-profit colleges sometimes don’t always do a great job of themselves: Offering a transparent profile of each school’s default rate, tuition, and stockholder information in one place.
The creators of Youth Today’s report [sub. req.] sifted through Department of Education data, as well as Securities and Exchange Commission filings for publicly traded schools, and requested information directly from the schools themselves. The authors even provide a repayment table to better help incoming students understand how much a loan will ultimately end up costing them.
The report is a step in the direction of making higher education—and for-profit education particularly—more transparent and accountable for their student outcomes – a trend the education industry has often resisted.
Part of the problem is that for-profit schools tend to be some of the worst offenders when it comes to transparency. Simply pressuring schools to be more upfront about crude but crucial statistics like graduate employment rates and student loan default rates is one way students could make better decisions about which school to attend.
Of course, measures like default rates, graduation rates, and employment rates aren’t perfect. “There are numerous ways to game that system,” says American Enterprise Institute research fellow Andrew Kelly, citing some recent reports in the Chronicle of Higher Educationthat document consulting firms that aim to keep schools from having high default rates by setting students up with forbearance or other loan deferral methods. “No matter where you put that goal post, they’ll find ways” to manipulate the data, Kelly says at an event Youth Today held on Wednesday. Only three attendees came to learn about the report.
The Department of Education has proposed a rule known as gainful employment that would pull federal aid funding from schools that have too-high default rates. Secretary of Education Arne Duncan recently promised a finalized rule in the coming months.
“There are students who will default through no fault of the colleges, but [high default rates are] an indicator that something is wrong,” says Julie Morgan, a policy analyst with the Center for American Progress, the parent organization of Campus Progress.
Youth Today’s report, while a serious attempt to offer a comprehensive perspective on for-profit schools, is still lacking. The text-heavy pages and color-coded banners are best suited to industry insiders rather than students attempting to make decisions about where to invest in higher education. Youth Today also wants to charge $6 a copy for the report, but even such a nominal barrier could keep such important information from students who are considering these schools. Morgan suggests that such information should be available on for-profit schools’ websites and on forms they need to sign.
And while Youth Today’s report does a good job of comparing for-profit schools to each other, most often students are comparing a number of options, both for-profit and non-profit, when making decisions about where to attend higher education.
Still, such a report is yet another reminder that, while the battle over what to do with for-profit schools has largely been fought over regulations, it is also about providing clear and accessible information for the students so they can make the best decisions.
Kay Steiger is the editor of CampusProgress.org.