Profiting Higher Education
What Students, Alumni and Employers Think About For-Profit Colleges
Are for-profit colleges worth the cost? Students and employers seem ambivalent, according to Public Agenda research, summarized in this 2014 report.
Current and former for-profit students are satisfied with the quality of their schools. But they also consider the financial burden of these schools high, and alumni in particular aren't certain their degree was worth it.
Many employers perceive no differences between for-profit and public sector institutions, and some are actually unfamiliar with for-profit schools. Among those who do see a difference, most say community colleges and four-year public universities do a better job than for-profits at preparing students for the workplace.
Generally, students – prospective, current and graduates – and employers also seem quite distanced from the enthusiastic policy conversation about for-profit colleges. For-profit colleges dominate headlines (most recently because of federal government scrutiny) and are a top concern for education leaders and policymakers. But most students and employers are actually unfamiliar with the term. Many for-profit students don't even realize that the school they're attending is a for-profit.
Moreover, leaders in higher education, the federal government and philanthropy invest time and effort to make comparative information about colleges more easily accessible and engaging so that students can make informed – and presumably better – decisions about their education. These findings suggest that for-profit students are not comparative shoppers. Just 39 percent considered more than one school before attending, and 20 percent considered a not-for-profit.
The findings from this study also bolster those from on our companion report, "Is College Worth It for Me?" which suggests that efforts and information to help students choose the college that's right for them are not connecting with prospective students. While for-profit alumni say incoming students should pay "a great deal" of attention to statistics like graduation rates and the types of jobs graduates get, most current students do not know this information about their own schools.
The research was funded by The Kresge Foundation and is based on representative surveys with employers, current for-profit undergraduates, for-profit alumni, and prospective students between the ages of 18 and 55. The report also includes findings from focus groups with employers and adult prospective students.
We explore the findings in more depth below. Be sure to download the report for the full story.
Current Students and Alumni Are Enthusiastic About Their Schools' Quality
Students and alumni are clearly enthusiastic about their schools on a number of quality measures. For example, they agree that their schools have caring instructors, keep class sizes small, and give effective guidance (though alumni are slightly less enthusiastic). Current students also say their schools allow them to make good progress in their course of study.
But They Worry About Cost and Long-Term Value
Both students and alumni say their schools are expensive, and nearly half (47 percent) of current students say they worry "a lot" about taking on too much debt.
Alumni in particular are skeptical about the value of their degree, with 32 percent saying their degree "really wasn't worth it." (Thirty-seven percent say their degree was "well worth it"; 30 percent say it "remains to be seen.")
Furthermore, 4 in 10 say their schools were more concerned about making money than about educating students (only 20 percent of current for-profit students feel this way.
We did speak with for-profit alumni during a down job market, which may have an effect on their perspective. Nevertheless, it is certainly the case in this study that many graduates from for-profit schools put some blame on their schools for not adequately preparing them for the job market.
These findings are illustrated in the video below:
Prospective students considering for-profit colleges have distinct priorities
Adult prospective students who are considering a for-profit college are more likely to say that qualities like the availability of online classes, accelerated programs and hands-on support services are absolutely essential when they are choosing a school.
The research doesn’t establish whether there is a causal relationship between these individuals’ priorities and the schools they are favoring. However, these findings, combined with the satisfaction we see among current for-profit undergraduates, certainly raise an important question that warrants further digging: Are for-profits better than public institutions at serving the needs of some students?
Employers Are Still on the Sidelines
About half of the employers surveyed see few differences between for-profit and not-for-profit colleges. The other half typically view public institutions as superior on a number of counts. For example, 41 percent say public universities do a better job preparing students to work at their organizations.
Students Are Unfamiliar with the Term "For-Profit College" – Even When They're Attending One
The research also reveals a startling lack of awareness among students about the overall concept of for-profit colleges, especially in contrast to the energetic debate about the sector among experts, policymakers and the media. Many students who are attending or graduated from a for-profit school say "nothing comes to mind" when they hear the term. Over half of adult prospective students considering attending a for-profit school say the same. Furthermore, a full 65 percent of current for-profit students and 63 percent of for-profit alumni are unsure whether their school is for-profit or not.
Employers also lack knowledge on for-profit schools. Seventy-six percent haven’t heard or don’t know much about local for-profit schools in their own metropolitan area and 50 percent don’t have an opinion about large national for-profits like the University of Phoenix or DeVry. But nearly nine in ten (87 percent) are familiar with and opinionated about their region’s public universities.
Incoming Students Not Well-Informed About College Choices
Students from for-profit schools – who often come from economically vulnerable populations – are not comparative shoppers. Many are selecting schools without having weighed different options. Just 39 percent of for-profit undergraduates and 32 percent of for-profit alumni had considered more than one school before they enrolled at their current institutions. Students are even less likely to compare for-profit with not-for-profit schools before enrolling, with just 20 percent of for-profit undergraduates and 11 percent of alumni having considered a not-for-profit college. Parallel research with community college students suggests that "comparative shopping" is uncommon among other types of college students as well. Many students seem to be drawn to either for-profit or not-for-profit schools, though rarely to both.
As our Research Director, Carolin Hagelskamp, put it, "I think sometimes policymakers have this idealistic vision of students sitting down with spreadsheets, comparing colleges across columns and columns of data. But the reality is that most students in this research are not really making comparisons at all. They rely on recommendations from friends and families and hear about schools through ads or because they pass by the schools on the street."
The research also suggests that incoming students may not understand how existing data about average student debt and the jobs and salaries of typical graduates relate to their college searches. Even though current for-profit students worry about debt, 61 percent do not know how much debt the average student from their school graduates with. With the benefit of hindsight, for-profit alumni say this information is valuable. Seven in 10 alumni say students should pay a "great deal" of attention to student debt data before enrolling, and 72 percent recommend incoming students pay attention to the types of jobs and salaries graduates typically get before enrolling. The research indicates that these alumni's insights still need to be bestowed on prospective students.
This report is part of a larger project surveying the attitudes of various student and employer groups toward issues in higher education, including online education, for-profit colleges and the needs of nontraditional students. To read the findings from these surveys, see the reports Is College Worth It For Me? and Not Yet Sold.
For-Profit Colleges Have Some Strengths, But Are They Worth the Cost?