APSCU Blog: Gainful Employment Update: What’s Next and Unanswered Questions

27 Oct 2014 /By APSCU Communications 
As the gainful employment regulatory process comes to an end, we wanted to give a short update on the status of what has taken place and what happens next.

On October 14, APSCU met with officials from the Office of Management and Budget (OMB), along with their colleagues at the Office of Information and Regulatory Affairs (OIRA), the Council of Economic Advisers and the U.S. Department of Education and presented our concerns on the regulation and the impact it will have on students, the economy and institutions. Other higher education stakeholders have also been meeting with OMB during this time.

During the meeting we presented very specific arguments and issues with the regulation (our full presentation is available online):
  • The Administration’s rhetoric on the Rating System does not equal reality on gainful employment regulation (slide 4)
  • Why each metric is arbitrary and capricious (slides 5&6)
  • Results of new analysis showing earnings before education and earnings post-graduation – 100% earnings gain in some fields (slides 11-13)
  • Private sector institutions have higher graduation rates and lower default rates than community colleges (slide 19)
  • The negative impact on students and programs (slides 7&8)
  • How others in higher education fail the regulation if it were applied to them (slide 17)
The regulation has now gone back from OMB to the Department and at some point before October 31, it is very likely the Department will publish the final regulation. Before they turn in their homework at the last minute, we wanted to pose some final questions for the Department to answer.
Below are nine questions that the Department should answer publicly before the regulation is released, but won’t. Instead, they will obfuscate and spin. While this is good politics, it is bad policy. Moreover, it will have a direct and negative impact on millions of Americans.

Question 1: What does this new regulation mean for students?

What ED is not telling you: Millions of students will lose access to the higher education career training program of their choice – limiting economic opportunity for them and their family.
Question 2: Does the gainful employment regulation help or hurt President Obama’s goal of having the most college graduates by 2020?

What ED is not telling you: The regulation will hurt this worthy goal. Thousands of programs will be eliminated or shut down, denying millions of students access to higher education and economic opportunity.

Question 3: What does this mean for employers looking for job-ready employees?

What ED is not telling you: Employers continue to struggle finding qualified workers to meet their needs. This problem will be worsened as a result of the regulation. Thousands of employers will be left without job ready employees because the training pipeline they rely on for qualified health care professionals, automotive techs, HVAC techs, and information technology professionals, among others, will be eliminated.

Question 4: What does this mean for states?

What ED is not telling you: This regulation will cost states billions of dollars over the next few years as they struggle to fill the gap left by private sector institutions that served students overlooked by traditional higher education.
Question 5: Are all institutions treated the same by the regulation? Will the regulation apply to programs at public and private nonprofit institutions?

What ED is not telling you: The Department is singling out private sector institutions and community colleges by applying the regulation to all their degree and non-degree programs.  Degree programs at public and private nonprofit institutions would not be held to the same standard. These programs get a free pass from the Department, despite the fact that millions of students attend them and they are responsible for the vast majority of dollars borrowed in higher education.
Question 6: Is this about student protection?

What ED is not telling you: No, the regulation does not address the vast majority of programs or students. Instead, it singles out institutions that serve historically underserved students and cuts off new traditional student access to higher education.

Question 7: How does this regulation compare to the President’s proposed Ratings System?
What ED is not telling you: The regulation stands in stark contrast to what has been said by the Administration about the President’s Ratings System. While the Administration claims it wants a ratings system that “thoughtfully measure indicators like earnings, to avoid overemphasizing income or first jobs,” according to Deputy Under Secretary Jamienne S. Studley, the reality is that the Department is creating the exact opposite with the GE regulation.
  • Early year earnings are a core component of the regulation’s metrics.
  • The regulation ignores the fact that private sector institutions are significantly more likely to serve low-income, first generation, and minority students, and have much higher graduation rates than community colleges.
  • The regulation evaluates programs that serve low-income students on measures of income and loan repayment, which could lead institutions to accept fewer of these students.
Question 8: Will the regulation close programs that provide significant earnings gain for graduates?

What ED is not telling you: Yes. It is unclear why the Department wants to close programs that are providing graduates, their families and their communities with an economic advantage.
Question 9: What is the Department’s basis and rationale for the 8% debt-to-earnings metric?

What ED is not telling you: To date the Department has not provided one, despite setting the threshold at 12% in the 2011 version of the regulation.

Direct link to article: http://www.highereducationforall.com/gainful-employment-update-whats-next-unanswered-questions/

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