Government

Demographics Do Not Explain For-Profit Colleges' Shortcomings on Student-Success Measures, GAO Says

December 07, 2011

For-profit institutions perform worse than public and private colleges on most measures of quality, even when student demographics are taken into account, according to a new report by the Government Accountability Office.

The report, which reviewed a limited number of studies that controlled for student characteristics, such as family income, found that for-profit colleges have higher graduation rates than other institutions for certificate programs, similar graduation rates for associate-degree programs, and lower graduation rates for bachelor's-degree programs.

Students who begin their studies at for-profit colleges earn about the same as students who start at nonprofit institutions, but graduates of for-profits are more likely to be unemployed. Bachelor's-degree recipients are more likely to borrow at for-profit colleges, and more likely to default on their loans (though one study found no difference between for-profit and private institutions on this measure).

The accountability office also reviewed passage rates on licensing examinations in 10 professions, including nursing, cosmetology, and law. It found that graduates of for-profit colleges had lower pass rates on nine of the exams.

For-profit colleges enroll a higher percentage of students who are over the age of 25, female, and financially independent than private and public colleges. Students attending for-profits also tend to have lower family incomes and are less likely to have a parent who attained an associate degree or higher, according to the report.

Lobbyists for the for-profit sector often point to these statistics to explain the institutions' high dropout and default rates.

In a statement, Brian Moran, the interim president of the Association of Private Sector Colleges and Universities, said the report "confirms that private-sector colleges and universities educate nontraditional students, making it difficult to accurately compare our students to students attending nonprofit schools."

But Sen. Tom Harkin, an Iowa Democrat who has been investigating for-profit colleges for more than a year, said the report shows that "the industry's long-standing excuse—that it's the students' fault that the schools have such poor success rates—does not hold."

"This is what we've been saying all along: The problem is not the students but the schools."

The release of the report comes two weeks after the accountability office reported that undercover investigators had found lax academic standards at some for-profit colleges.