For-profit career colleges are risky business for Ohio
Posted May 25, 2017 in Press Releases
Last year Ohio spent more than $7.3 million on financial aid for students at for-profit schools. Now new data show their students often do not earn enough to support themselves, let alone repay student loans.
For profit career colleges often target veterans, low-income workers, laid-off workers and others desperate to find a good job. A new report from Policy Matters Ohio shows for-profit schools’ bad track record and calls on the state to increase oversight.
Ohio’s need-based aid system preferences for-profit career colleges over more accountable and transparent public institutions. For-profit career colleges received $6.3 million from the state’s only need-based student aid program, the Ohio College Opportunity Grant (OCOG), and $717,561 from National Guard Scholarships, last year. In 2016, the same year it closed its campuses, ITT Tech received more than $1.1 million from OCOG — slightly more OCOG than the state’s entire two-year public system received.
“When higher education goes wrong, once-hopeful students can be burdened with debt, no degree, fewer resources and less will to pursue future education,” said Hannah Halbert, Policy Matters researcher and report author. “This frequently happens to students attending career training programs at for-profit institutions.”
Nearly one-third of for-profit certificate students enrolled in programs where the typical graduate earned less than what a minimum wage worker would earn in a year, according to the report. Certificate earners at public institutions earned an average of nearly $9,000 more than their for-profit counterparts. Thirty Ohio-based career college programs failed to show their grads entered gainful employment; all were offered by for-profit schools. Graduates of seven of the 10 most common career college programs offered by Ohio-based schools earn so little they would qualify for food assistance for a family of three.
“State financial aid is Ohio’s stamp of approval for an often risky and predatory sector,” Halbert said. “By providing aid to students at these institutions, Ohio is creating the wrong incentives. Students and the state are spending millions on profit-seeking schools, truly a risky business.”