For-Profit Colleges Fare Well in Report’s Analysis of Costs to Students and Taxpayers

Government should focus more energy on getting colleges to retain and graduate students, it should scrap its current methods for gathering data on colleges, and it should throw more support behind lower-cost, nontraditional colleges, like for-profit institutions.

These are just some of the conclusions of a report released today called "Who Wins? Who Pays? The Economic Returns and Costs of a Bachelor’s Degree."

The report is based on a study that attempts to tally the costs of higher education to taxpayers, as well as the benefits in salary that students reap, from various kinds of educational institutions. It was written by Mark Schneider, the vice president of American Institutes for Research, and Jorge Klor de Alva, a former president of the University of Phoenix who is now president of the Nexus Research and Policy Center. Nexus, which "seeks to do research and promote policies that improve the proprietary education sector," is supported by the Apollo Group, which owns the University of Phoenix, and by the foundation of John G. Sperling, the university’s founder. (The center has governance independent of its financial supporters.)

As the numbers are presented in the report, for-profit institutions come out looking like a very good investment — for taxpayers and students.

Within the first 10 years of completing their programs, graduates of for-profit institutions get wages that are comparable to or better than those earned by graduates of competitive and very competitive public and private colleges, the report says. Lifetime earnings don’t compete as well, but are still comparable to those of graduates of noncompetitive or competitive private institutions.

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