Education Department Launches Review of the University of Phoenix

Career College Central Summary:

  • Public interest in the for-profit industry has grown as more Americans have pursued nontraditional paths to a college education. As enrollment has grown, state and federal investigators have examined recruiting and marketing practices as well as academic activities at a number of for-profit schools. In 2012, a U.S. Senate investigation found widespread evidence that for-profit schools often appear to prioritize business concerns over educational quality or student progress, with most producing low graduation rates but double-digit profit margins for publicly traded companies.
  • The corporations behind for-profit colleges together reaped 86 percent of their revenue from federal student-aid programs, the Senate investigation found, but they have not faced congressional regulation or consistent oversight that might protect the interests of students and taxpayers. In fact, during the 2008-09 school year, half the students attending for-profit colleges left school without a degree, according to the Senate report. Many of these students were drawn to the schools by multimillion-dollar ad campaigns and high-stakes recruiting practices and then left school with life-altering amounts of debt, the Senate report found.
  • The industry has often countered criticisms with claims that for-profit colleges provide educational services to working adults and low-income and minority students—populations they say traditional nonprofit colleges and universities have long neglected or underserved. And officials at Apollo describe their schools as institutions that bolster the country and its most important economic goals.
  • "A few years ago, the president said he wanted to have a 2020 goal of getting additional people into and through college," Mark Brenner, Apollo's chief of staff, told National Journal recently. "To do that through the community college system alone, an additional $13.1 million [people] would need to graduate. So we know that the University of Phoenix has a role to play in that big goal for the country and for our students."
  • Brenner also stressed that the University of Phoenix network, while an industry leader, is not synonymous with the entire for-profit college sector. The University of Phoenix has made efforts to improve the services provided to students—changes that Brenner said will ultimately boost graduation and loan-repayment rates.

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