Employers will need more college-educated employees
A recent study out of Georgetown University predicts that, when the economy returns to stability and hiring picks up again, employers will need more college-educated employees than are available. The deficit of adequately educated employees could average 300,000 a year in the coming decade.
To meet the increasing need for higher education, a number of for-profit colleges have entered the education marketplace. Twenty-five percent of for-profit schools offer bachelor’s degrees, which is a far cry from the vocational schools and beauty schools of the past.
Enrollment at these schools have also continued to grow. In 2000, 673,000 students attended for-profit colleges. Now that number is 2.6 million.
As Kiplinger is reporting, with the rise in enrollment, there have come increased complaints about student debt loads, and the ability of students to repay them.
Regulators cracking down
In response to the growth in the for-profit college industry, the Department of Education is becoming more stringent with its regulations.
The department wants to require colleges to let prospective students know what their graduation rates are and what their job-placement statistics show. There is, in the mind of the Department of Education, an acceptable ratio of student debt service to income, which it considers to be gainful employment.
They also want to limit some of the more high-intensity ways that for-profit colleges market their schools. Proposed rules would increase the rules against compensation currently allowed for recruiters, who are paid based on the number of students that they are able to recruit. Such limits would help to curb some high-pressure sales tactics that for-profit colleges enlist via recruiters.
Increased oversight
Education Secretary Arne Duncan recently announced that the department will step up its oversight of federal student financial-aid programs to try and curb these sales tactics. The news came after a government investigation uncovered deceptive marketing practices at 15 for-profit colleges.
The increased oversight would mean expanding the Education Department’s enforcement staff, continuing undercover investigations and increasing program reviews.
“We have a responsibility to ensure that students can make informed choices about investing in post-secondary education, and that taxpayers’ investments in the federal student aid programs are helping students,” said Duncan.
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