December 7, 2011

Durbin, Harkin: GAO Report Rejects For-Profit College Industry's Excuse for Poor Student Success Rates

Report Shows For-Profit College Students Fare Worse Overall than Nonprofit, Public College Students

[WASHINGTON, D.C.] – U.S. Senators Dick Durbin (D-IL) and Tom Harkin (D-IA) announced that a new Government Accountability Office (GAO) report debunks the for-profit college industry's longtime excuse for poor student success rates at their schools:  that they enroll students whose socioeconomic status and other characteristics make them "high-risk."  Today’s GAO report, which compares student success rates at for-profit, nonprofit, and public colleges, controlled for those characteristics and found that overall, for-profit college students still have lower success rates. 

 

“Every high school student in America should read this damning report on for-profit colleges.  When it comes to loans and debt, students at for-profit colleges have higher debt levels, higher default rates and worse outcomes than their peers attending non-profit or public institutions. For years, for-profit colleges have claimed this is because they serve low-income and minority students,” said Durbin.  “I don’t buy it and, according to today’s report, neither does the GAO.  It is far too easy for these for-profit schools to place the blame on a failing student.  The blame lies with for-profit schools.”  Additional remarks about the GAO report – delivered by Durbin on the Senate floor – will be available on his website later today.

 

“Once again a report reveals that too many students at for-profit colleges end up without a diploma and saddled with debt.  But that’s not news anymore,” said Harkin.  “What this report shows is that the industry’s long-standing excuse – that it’s the students’ fault that the schools have such poor success rates – does not hold.  Instead, as our investigation has uncovered, it’s the schools that go out and recruit these students using taxpayer dollars but fail to provide them with a quality education.  This is what we’ve been saying all along: the problem is not the students, but the schools.”

 

While students at for-profit schools may get a certificate within six years at a higher rate than those who start at a community college, only four percent get their bachelor’s degree.  And when they leave school, students who attended for-profit schools are worse off: they have higher rates of unemployment and according to Harvard researchers’ data that underlies GAO’s report, they earn 8 to 9 percent less (about $2000 a year on average) than students who attended public or non-profit institutions.   In addition, more for-profit students borrow, borrow more, and default on their loans at higher rates.  Finally, students at for-profit schools who are able to take required licensing exams have worse pass rates in 8 of 9 fields examined by GAO. 

 

Out of the nine key metrics of student success that this report examined, when compared with students at nonprofit and public colleges, students at for-profit colleges had better outcomes on one metric:

 

  • Certificate graduation

 

Similar outcomes on two metrics:

  • Associate graduation
  • Earnings

 

And worse outcomes on six metrics:

  • Bachelor’s graduation
  • Unemployment
  • Borrowing rate
  • Debt load
  • Loan default rates
  • Licensing exam pass rates.

 

These findings are consistent with a study commissioned by the for-profit college industry, which was one of the studies used by GAO to compile this report, which found for-profit college students are twice as likely as other college students to default. 

 

They also confirm the disturbing revelations of Senator Harkin’s Health, Education, Labor and Pensions (HELP) Committee investigation of the for-profit college industry, which found that an ever-growing share of federal dollars are being funneled to high-cost, low-quality programs with questionable practices and poor student outcomes.

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