The Average Student at a For-Profit College Was Worse Off After Attending Undergraduates were less likely to be employed and earned smaller paychecks, largely due to high dropout rates, a new study found By Josh Mitchell
http://blogs.wsj.com/economics/2016/05/31/the-average-student-at-a-for-profit-college-was-worse-off-than-before-attending-school/
Millions of Americans enrolled in for-profit colleges in recent years to learn a trade and find decent-paying work. A new study found devastating results for many of their careers.
The working paper, published this week by the National Bureau of Economic Research, tracks 1.4 million students who left a for-profit school from 2006 through 2008. Because students at these schools tend to be older than recent high-school graduates, they’ve spent time in the workforce. The researchers used Education Department and Internal Revenue Service data to track their earnings before and after they left school.
The result: Students on average were worse off after attending for-profit schools. Undergraduates were less likely to be employed, and earned smaller paychecks–about $600 to $700 per year less–after leaving school compared to their lives before. Those who enrolled in certificate programs made roughly $920 less per year in the six years after school compared to before they enrolled.
The key factor is that most of these students never earned a degree–they dropped out early. Excluding them, the minority of students who earned degrees saw an earnings bump after graduating.
“Certificate, associate’s, and bachelor’s degree students generally experience declines in earnings in the 5 to 6 years after attendance relative to their own earnings in the years before attendance,” write co-authors Stephanie Riegg Cellini of George Washington University and Nicholas Turner of the U.S. Treasury Department.
The picture is even worse when considering most students borrowed to attend the colleges. Nearly 9 out of 10 for-profit school students took on student debt; those in associate’s programs borrowed an average $8,000 and those in bachelor’s programs, $13,000. CONTINUE AT SITE
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