Drop-out rates are high at 16 for-profit colleges, charged Sen. Tom Harkin, D-Iowa, at a Health, Education, Labor and Pensions Committee hearing. Nearly 57 percent of students dropped out by the second year, leaving them with nothing to show but debt, Harkin said.
“Going to college should not be like going to a casino where the house usually wins,” Harkin said at the hearing.
Harkin’s report didn’t provide dropout rates for public colleges and universities or for private nonprofit institutions, notes Bloomberg News.
About 38 percent of students at for-profit four-year colleges graduate within six years, compared with 53 percent at public institutions and 64 percent at nonprofits, according to an April report from the National Center for Education Statistics.
For-profit institutions enroll more low-income, minority and first-generation college students who have lower graduation rates. These high-risk students are more likely to complete a degree in for-profit institutions, according to Robert J. Shapiro of Sonecon, author of a report for the industry on the public costs of higher education.
. . . lower-income students make up nearly two-thirds of those attending private for-profit colleges and universities, compared to just over one-third of those at public and private not-for-profit institutions. . . . The graduation rates for four-year institutions with predominantly lower-income students are 55 percent for private for-profits, compared to 39 percent for private not-for-profits and 31 percent for such public institutions. Similarly, across four-year institutions with predominantly minority student bodies, graduation rates are 47 percent at the private for-profits, compared to 40 percent at their private not-for-profit counterparts and 33 percent for public institutions.
Overall, graduation rates are lower for students in four-year for-profit programs, but much higher for students seeking two-year degrees: The for-profit graduation rate is about 60 percent for two-year degrees versus 22 percent for community colleges.
Of course, for-profit students take on much more debt than community college students. In part, that’s because taxpayers subsidize public colleges, notes the Center for American Progress.
Whether it’s worth paying more to study at a for-profit depends on whether students can get the right classes at the right time at a public institution. Time is money.
For-profit college students rallied against federal regulation in D.C. on Wednesday. Turn-out was modest.