“Gainful Employment” Rule Threatens Black, Hispanic Matriculation

Every year, millions of African American and Hispanic students enroll in career colleges – for-profit institutions of higher learning like the University of Phoenix or ITT Tech – and each year, represent 39 percent of all graduates from those schools.

For some students, for-profit colleges are their only opportunity to receive higher education. That option may be taken off the table, however, if the Department of Education is successful in reintroducing the ‘gainful employment rule’ into federal financing of college education.

Riding the tailwinds of President Obama’s State of the Union address, Education Secretary Arne Duncan and his colleagues have been going swing-state to swing-state promoting ‘education affordability.’ With ever escalating tuition costs and the United States now ranking 16th globally in college graduates, the DOE is hoping to dramatically alter the current landscape for federally supporting for-profit institutions.

Not so fast says the National Black Chamber of Commerce (NBCC) and a host of other dissenters. According to Harry Alford, NBCC’s president, the “Department of Education’s calculation error confirms our initial concerns that the ‘Gainful Employment’ rule would unfairly harm minority students at proprietary colleges and universities.

“The department has failed time and again,” he said, “to recognize that repayment rates at proprietary schools are based heavily on demographics – and it has now been forced to re-release the ‘Gainful Employment’ rule based on incorrect interpretation of the statistical results.

“Had the Department of Education conducted a Minority Student Impact Assessment – as the National Black Chamber of Commerce and other minority leaders had called for in May of 2011 – we would not be facing this issue.”

NBCC and other opponents of the rule fear that, once enacted, ‘gainful employment’ regulations will seal the fates of millions of minority students who rely on federal funding to attend career schools. Those students would no longer have the financial means to get the very degrees that are essential to being competitive in a modern economy, and lead to greater employment opportunities.

For its part, the DOE believes that gainful employment regulations are necessary because many students attending career schools end up saddled with debt and limited job prospects.

Instead of supporting career colleges, which are home to a substantial minority student population, the government believes federal dollars could be better spent on non-profit public and private institutions.

On the surface that makes sense, but the devil is in the details, or rather lack of details and due diligence.

When the DOE first presented the “gainful employment” rule, NBCC and others adamantly opposed it because there had been no study conducted with respect to the impact the rule would have on low-income and minority students. That the DOE admitted to making errors in its data calculations, NBCC and others’ concerned deepened about the potential unintended consequences of applying this rule.

DOE officials disclosed the error in a December court filing, which is part of the ongoing legal challenge to gainful employment by the Association of Private Sector Colleges and Universities, the primary for-profit college trade group. That lawsuit appears to have led to the mistake’s discovery.

Career college graduates are 39 percent minority, whereas 17 percent of graduating students from private not-for-profit colleges, and 20 percent of graduating students from public not-for-profit institutions are minority.

With statistics like these, the potential impact on minority students educational prospects become clearer when considering that the gainful employment rule may make it more difficult for students of color to receive a college degree.

Lets face it. Job prospects aren’t particularly bright for most college grads right now, whether they receive their degree at for-profit, non-profit, private or public institutions of higher learning.

At a minimum, we owe it to all potential students to leave as many education options viable and available.

POLITIC365

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