For-profit schools are MORE expensive
(especially in comparison to public institutions, such as community colleges that represent many for-profits’ main competition)
Bachelor’s Degree programs at for-profit schools cost an average of 50% more then the 4-year in-state public school program. Associate’s Degree programs (the 2-year in-state figure in the chart at the top) the for profit school charges over of 400% of public school in-state tuition. Surprising? Not considering how for-profit colleges are spending their money. 22.7 percent of revenue at for-profits goes to marketing and recruitment, that for-profits have an average profit margin of 19.7 percent, and pay an average of $7.3 million a year to their chief executives. That’s all money that drives up tuition without going to educational programming. Actual instruction accounted for only 17.2 percent of expenses. As a consequence of these bloated prices, a far greater percentage of for-profit college students are in debt.
In the 2009-2010 school year, $7.5 billion in Pell Grants, 50 percent of Defense Department education aid, and 37 percent of GI bill aid went to for-profits, money that, because of the programs’ much higher costs, financed significantly less education than it would have at public or private non-profit institutions.
Most students at for-profit schools don’t graduate
In a recent study conducted by the Department of Education:
- 54.3 percent of students enrolled left bachelor’s programs before graduating;
- 62.9 percent of students enrolled in an associate’s degree program at a for-profit college left before finishing their degree; (and the median associate’s degree student lasted only four months)
- 38.5 percent of students enrolled left certificate programs;
Taken together, half of all students were drop outs. This is important, especially when compared to public institutions.