For-Profit Schools: Avoiding the Perils
Research and determination are key to avoiding the pitfalls in this growing sector of the education industry
When Cee Jones, 41, of Richmond, Va., started her nursing program at the for-profit Medical Careers Institute, she was one of a class of 53 students.
By the time graduation day arrived one year later, Jones was one of only 12.
Jones incurred student-loan debt totaling about $17,000, but she left school as a licensed practical nurse and quickly found employment at a nursing home. Today, six years after her graduation, the divorced mother of three works at a medical clinic.
“I’m not living in subsidized housing anymore, I have a car; it served its purpose for me,” Jones said.
Bridget Hughes, 22, of Kansas City, Mo., was not as lucky. She took out $14,000 in student loans to enroll in a nine-month medical assistant program at the for-profit Concorde Career College -- only to find that she had wasted both her time and money.
Hughes entered Concorde in November 2009 without having a high school diploma or GED, something she later found that employers require before they will even consider hiring someone as a medical assistant. But Hughes said no one at Concorde told her that. So, despite successfully completing the program, her medical assistant certificate is worthless.
Since finishing the program in June 2010, the married mother of two children, ages 3 and 1, has been unable to secure full-time employment. She works part-time for minimum wage at a Domino’s Pizza as a customer service representative. She also does seasonal work as a tax preparer.
“I really loved the program,” Hughes said, “but they did not explain to me about my GED until after I finished. I wish Concorde had been what it was supposed to be. Instead, I’m struggling, going from job to job. … Basically, I’m in the same spot I was in before, but $14,000 in debt.”
Expensive programs. High dropout rates. Aggressive recruiting. Little assurance that a degree or certificate is worth what students paid for it -- or that they'll be able to repay whatever loans they took to do so. Such can be the pitfalls students face at for-profit schools; schools that are increasing in both enrollment and the amount of taxpayer dollars received in the form of federal student aid.
African American, Latino and lower-income students are especially vulnerable. Almost half the students at for-profit schools are African American or Latino. In comparison, only one quarter of students at nonprofit or public institutions are black or Latino, according to the U.S. Government Accounting Office. Family median income is just under $23,000 per year for 76 percent of for-profit students. In addition, a staggering 1 in 5 for-profit students default on their student loans within three years of beginning repayment, almost four times higher than the rate among nonprofits, according to the Education Trust, a Washington, D.C.-based think tank.
In fact, 20 percent of all African American students attend for-profit schools, compared to 12 percent of students in the general population, with the University of Phoenix, one of the nation’s largest for-profits, graduating the largest number of African American college graduates in the U.S.