US News & World Report: For-Profit Colleges May Be Better at Meeting Some Student Needs, Report Says

February 11, 2014

By Allie Bidwell

For-profit colleges may be doing a better job of serving the needs and desires of certain types of students than public and not-for-profit colleges, according to new research released Monday.

In a survey of more than 400 current and former students of for-profit colleges, as well as 803 prospective students considering for-profits, the nonprofit organization Public Agenda found that both groups were overwhelmingly satisfied with the quality of their education while in school – measured by small class sizes, instructors who care about their students, and school officials who provide  hands-on help with financial aid applications.

“We found overwhelming enthusiasm among both current undergraduates from for-profits and alumni in terms of a whole list of key quality indicators for schools,” says Carolin Hagelskamp, lead researcher for the study. “For all of these things, students and alumni were very positive about when it came to their school.”

[READ: Transfers to For-Profit Colleges Earn Less Than Others, Report Finds]

The study also found a distinct divide between the kinds of services students look for, based on what types of colleges they are considering. Among prospective students, those considering for-profit colleges were more likely to highly prioritize schools that allowed them to graduate quickly, offer online classes and provide hands-on help from career counselors, financial aid advisers and tutors.

Although the research doesn't establish whether there is a causal relationship between prospective students' priorities and the types of schools they choose, students' reported priorities combined with their satisfaction while attending for-profits begs the question if those institutions are better than not-for-profit schools at serving the needs of some students, Hagelskamp said in a statement.

Noah Black, vice president of communications for the Association of Private Sector Colleges and Universities, tells U.S. News in a statement that the report is a sign for-profit colleges are “being responsive to today’s students in ways that traditional institutions are not.”

“There is demand for education that meets these needs and if our institutions were not meeting that demand, many of these new traditional students would not have an opportunity to receive higher education,” Black says.

Still, both current and former students are concerned about the financial burden of these schools, and some remain skeptical about the value of their degrees in the job market. The for-profit sector has come under fire for what some say are aggressive recruitment tactics, and the fact that they tend to have lower graduation rates and higher student loan default rates than other types of colleges.

[MORE: Democratic Report Blasts For-Profit Colleges]

DeVry Education Group – the company that operates several for-profit institutions – disclosed last Jan. 28 that it is under investigation by the Federal Trade Commission for its advertising and marketing practices. The FTC is looking into whether DeVry Education Group has violated Section 5 of the Federal Trade Commission Act, which prohibits “unfair or deceptive acts or practices in or affecting commerce.”

Responses from prospective students in the Public Agenda survey seem to be in line with claims that for-profit colleges attract most of their students from advertising and recruitment efforts. 

Among adults interested in for-profit colleges, 75 percent said they learned about colleges from commercials, billboards or other ads, for example, compared with 60 percent of those interested in public or private not-for-profit schools.

“There’s a lot of talk ... that for-profits are particularly good at advertising and providing a certain kind of education that some people are particularly interested in, which is accelerated education, online education, practical programs,” Hagelskamp says. “It kind of fits with this idea that somehow the for-profit sector is at least better in highlighting these services. Then we think the next question is: 'Are they also better at providing them?'”

The report also notes that 61 percent of current for-profit students are unaware of how much debt the average student graduates with, and just 31 percent say they know a great deal about the types of jobs and salaries available for graduates from their programs of study.

[RELATED: Change to Loan Qualifications Hurt Students at HBCUs, For-Profit Colleges]

And while current students are more optimistic about the value of their degrees and certificates, alumni were more skeptical. More than one-third of alumni (37 percent) said their degrees were “well worth it.” But another 32 percent said they were not, and the remaining 30 percent said the value of their degrees is yet to be seen.

“That’s a big number of people who invested quite a bit into their education, who aren't sure that it was well worth it, even though they think they got not bad-quality when they were there,” Hagelskamp says. “They’re skeptical on how much they learned that was worth it for the labor market and whether the degree was valued in the labor market.”

But the percentage of alumni who remain unsure of the value of their degrees is likely a product of the economy, Black says.

Still, the report says even among alumni who graduated before 2012 – and have had more time to look for a job – 70 percent did not say their certificates or degrees were well worth it.

Despite the skepticism among alumni looking back on the value of their certificates and degrees, most don’t say their schools prepared them poorly. More than half (58 percent) said their schools did either an excellent or a good job teaching them real-world skills to succeed in the workforce. Another 27 percent said their schools did a fair job accomplishing this goal, while 11 percent said their schools did a poor job, and 3 percent didn't know.

“That’s really where this question comes in that even though students are happy, is it worth it given the costs?” Hagelskamp says. “Could they have the same high-quality experience for a lower cost in a public school?”

But the survey also came to the conclusion that for-profit undergraduates aren't comparative shoppers. Fewer than half of current for-profit students said they seriously considered more than one, and nearly half don’t understand the difference between for-profit and nonprofit schools.

[SEE ALSO: How to Vet a For-Profit Online Program]

“We believe it’s something that needs to be addressed, just for people to make more informed decisions, not that they should go one way or the other, but it’s an important piece of information,” Hagelskamp says.

There was also a distinct divide among students who did consider more than one school, Hagelskamp says. There was a group that considered for-profit schools and a group that considered mainly public schools, with very little overlap. But shopping around is uncommon among other groups of students as well, the report says. Previous research showed fewer than 4 in 10 community college students seriously considered other schools before enrolling at their community colleges, the report says.

“The whole idea of prospective students being these comparative, very deliberate, rational shoppers of education that education leaders would like them to be, given all the information and all the effort that’s being put into providing information, we’re just not seeing that in this group either,” Hagelskamp says.

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