Are Big For-Profit Colleges Dying?

[sanantone]

How do we know their operations aren't changing? They just made the switch. All we know is that they didn't change their leadership.

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From a business perspective, for-profit and non-profit only differ in how profits are dispersed. Whether an institution is taking advantage of students or is acting ethically goes alot deeper than its business structure.

When it comes to the education field the goals are different, so how students are treated is different. Students at for-profits are more likely to be treated as customers. Some might think this is a good thing, but this often leads to students dictating how they are educated. From a more objective standpoint, federal government investigations found that many for-profit college admissions advisors were being paid a commission based on how many students they could get to enroll, which is against the law.

When everything can't be understood with stats, field studies are often done. I don't know if any education researcher has done a qualitative study. I just know that I've been on the inside as an instructor and student at for-profit and non-profit colleges. 

I think the media has done a good job of demonizing for-profit colleges. First they tried to demonize online learning altogether, that failed, and then they moved into phase two, attacking for-profits. Your tax status doesn't automatically mean you're a good school or bad school since both for-profits and non-profits have their share of good and bad. Ashford University, for example, could switch to any status it wants, it will still be a crummy operation.

Unfortunately, the public is mostly brain-dead and can't think for themselves, so whatever mass media tells them is what they go with. "For-profits are bad, run!" Then they go to a non-profit, get a substandard education and a wild debt and wonder what the hell just happened?

The media doesn't need to do anything. The stats speak for themselves. When 2-year for-profits are compared to community colleges (these two types of colleges have similar student bodies), for-profit graduates have worse employment outcomes. It just doesn't make sense to spend more for a worse outcome. It doesn't even make sense to spend more for the same outcome.

The general public isn't reading stats. They see an exposé on 20/20 on a couple of bad for-profit schools, and suddenly they conclude that all for-profits are bad and a scam. That's essentially what's happened, because the average person is not aware of things like what alexf.1990 pointed out. 

Some 2-year for-profits simply offer programs the local community college doesn't, so that can be part of the draw at times.

While for-profit schools may carry higher tuition rates in aggregate, the misconception the public has is that all non-profits are cheaper based on that, and it's simply untrue. It's also untrue that non-profit = better education. Employment outcomes may be better through non-profits, but that's probably a result of a combination of misconceptions held by employers being applied to the whole based on some of the bad programs, coupled with a less-connected alumni base and fewer overall connections given that many for-profit schools do most of their teaching online.

In the grand scheme of things, no one cares about outliers. Policymakers care about overall trends.

I'll see if I can dig up this study from a few years ago, but it found that there really wasn't a significant difference in how employers view online vs. on-campus and for-profit vs. nonprofit programs. Additionally, employers often can't tell which is which. People on education forums are outliers. I can probably name several hundred schools off the top of my head along with their tax status and accreditation. Ask a random people whether or not Colorado Technical University is for-profit or nonprofit, RA or NA, and primarily online or brick and mortar. Probably only people in Colorado know anything about the school. 

Part of the draw to for-profits vs. CCs that offer the same programs is that for-profits often handle the entire financial aid process, and their placement standards are more lax if they even have a placement system. Many for-profits don't even bother to test their students, so people who can't read and/or do high school algebra are put directly into college-level courses.

I asked my students at a for-profit if they knew that the Alamo Community Colleges were a lot cheaper. Most of them did not because they didn't do any research. These were first-generation college students, so they thought it was normal to pay nearly $30k for an associate's degree. I had a couple of other students who failed to make it at Texas community colleges, so they enrolled in that school. But, I generally think the problem is lack of research and confusion over the financial aid process. I've had dozens of people tell me that an online program at a for-profit was their only option when I could literally find several nonprofit options in a couple of minutes.