This is a very telling but self-explanatory chart from the Brookings Institute:
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4 thoughts on “Where Student Loans Have Generated the Most Institutional Revenue”
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Reblogged this on Ohio Higher Ed.
The chart shows student debt and not what the title says as “most revenue”. One also needs to unpack this a bit. Many of the for-profits started out offering programs to those who were employed and thus had an income and a choice of managing both their debt and the subsidies that could be provided by employers.
A number of these still serve that community. Others have opened their enrollment to the typical undergraduate. Additionally, as the concern has arisen, it is seen that some of these students make unwise choices of both their institution and the majors they take as well as their “abilities” to maintain their courses towards graduation.
What lies under this data may be of more substantive interest rather than a chart posted “naked”
There have been numerous other posts to this blog on student debt and on the abuses perpetrated by the largely online for-profit universities and colleges. So, this post does not exist in a vacuum–has a context–even on this blog.
From the Harkin Report and from several other substantial reports published by highly regarded think tanks, it is very well documented that the University of Phoenix has annually received very close to the allowable maximum of 90% of its revenue from federal student aid and that such aid has accounted for at least 75% to 85% of the revenue at almost all of the other large online for-profit institutions. Indeed, if anything, the chart under-represents the institutional dependence on federal student aid because it does not include grants– most significantly, Pell grants. So, unless one is going to make the largely discounted argument that students and their families might have been taking educational loans to cover other purchases, student-loan debt is institutional revenue, whether it is spent on tuition and fees or on room and board. And the list would be more damning for the for-profit institutions if the aid were shown as a percentage of the ttotal institutional revenue, rather than as a raw number.
As to the second point about the preparedness of students to complete the programs offered by these institutions, it has also been extensively documented that many of the institutions have employed far more recruiters than instructional staff, that they have targeted students based more on their eligibility for aid than on their academic readiness, and indeed, that they especially targeted students who had had difficulty being admitted to or completing programs at community colleges and public universities. So, in this instance, blaming the students is very misleading since there is much evidence that they were systematically targeted–preyed upon–with sales pitches shaped very pointedly to their gullibilities.
In short, “what lies under this data” is hardly going to be of benefit in salvaging the reputations of these institutions.
Lastly, although I would be loathe to stigmatize all for-profit institutions, the explosive growth of this sector between 2000 and 2010 and its collapse in the five year since suggests in itself the scope of the abuses that have occurred. And all of this has occurred on an unprecedented scale despite the fact that this sector was previously regarded as being very prone to such abuses. The new digital technologies simply made the previous sorts of abuses possible on an exponentially broader scale.
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