A call to bring back ‘gainful employment’

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A civil and human rights organization is calling for strong “gainful employment” regulations to protect college students, in particular African-Americans and Latinos, from unscrupulous for-profit schools.

The Leadership Conference Education Fund released a policy brief on Thursday that called on the U.S. Education Department to revisit the so-called gainful employment (GE) rule, which was promulgated during the Obama administration mainly to ensure that for-profit institutions were not burdening students with college loans that they could not repay. U.S. Education Secretary Betsy DeVos nixed the rule this year, but a House bill to reauthorize the Higher Education Act (HEA) introduced by Democrats this week would require the department to establish a GE measure.

The new policy brief noted that African-American and Latino students are over-represented in for-profit colleges. While African-American and Latino students comprise 34 percent of all postsecondary enrollments, they represent 51 percent of students at for-profit institutions.

Students at for-profit colleges are much less likely to graduate than students at public and private non-profit schools, and for-profits are more expensive than public colleges – on average, twice as much as public two-year colleges, the brief said.

It added that students who attend for-profits are more likely to incur high student loan debt and to default on their student loans.

Students who graduate from a for-profit college also do worse in the labor market than they otherwise would with only a high school education, even though the credentials they offer tend to be 30 to 40 percent more expensive than the same credentials from a public institution, the brief said.

“Rather than providing a path toward educational and economic opportunity, for-profit colleges often do the opposite,” it said.

Twenty-one civil rights, consumer lending and education groups signed onto the brief, including the NAACP, National Urban League, Center for Law and Social Policy, National Education Association, The Education Trust and The Institute for College Access and Success (TICAS), among others.

More than 350,000 postsecondary graduates carrying $7.5 billion in debt attended career programs below minimum standards, according to a recent analysis of federal data by TICAS. That figure doesn’t include students in career programs who didn’t graduate and incurred student debt, it added.

GE’s recent history

Education Trust said DeVos’ nixing the GE rule will allow low-quality, for-profit institutions to avoid accountability from the federal government and enable the exploitation of students, particularly students of color.

The organization would like to see GE rules that are tough but are fair. For example, among its recommended criteria for a new GE rule, it calls to reward rather than burden low-cost programs where most graduates do not borrow.

“Programs that are low-cost and have a small percentage of borrowers should not be unfairly punished by these regulations,” it said.

Although the nixed GE rule focused on for-profits, Title IV-eligible certificate programs at community colleges also would have fallen under the rules. Most public two-year colleges faced costly burdens in complying with the reporting requirements, according to community college advocates.

Despite those problems, organizations such as the American Association of Community Colleges (AACC) and the Association of Community College Trustees (ACCT) didn’t entirely oppose the regulation. In fact, AACC and ACCT agreed with a U.S. Education Department proposal that data on outcomes, debt and earnings should not be limited to GE programs.

AACC also has proposed gathering needed data on all college programs among its recommendations to reauthorize HEA. The association said it could be done by creating a unit record data system that links to graduates’ earnings. The House HEA legislation proposed this week by Democrats would lift a current ban on using student unit records. Proponents argue that such student-level data could help to evaluate postsecondary outcomes, such as transfer, employment and earnings.

About the Author

Matthew Dembicki
is editor of Community College Daily and serves as publications director for the American Association of Community Colleges.