One area in which the federal Education Department has taken a recent interest is the plight of those students who, fresh from a for-profit higher education program, struggle to find well-paying jobs while drowning in high levels of student debt. Research shows that these students tend to be poorer, more female and often are single parents; therefore, this is an important equity issue for the Education Department. ED has even gone to the extent of openly questioning these for-profit higher education programs and providing statistical support to back up their words of warning.
Recently, Education Secretary Arne Duncan provided this statistic to urge Americans to be wary of for-profit programs:
“Of the for-profit gainful employment programs that our department could analyze, and which could be affected by our actions today, the majority — the significant majority, 72 percent — produce graduates who on average earned less than high school dropouts.”
But is the situation really so dire? Glenn Kessler, of the Washington Post’s Fact Checker, was compelled by this statistic and did a thorough analysis of it. His analysis, in turn, proved compelling enough that the Education Department and the New America Foundation produced their own more in-depth analyses of the statistic.
Kessler looked into how ED came up with the statistic and found that they used median data for high school dropouts that ended up showing an average yearly income of $24,492. Another figure, compiled by the Labor Department showed an income of only $18,580. In the Education Department’s direct dialogue with Kessler, they admitted that their method showed a higher number which did benefit their argument, but they still believe their figure, drawn from weekly data multiplied times 52 (without knowledge of whether the individual did actually work for the entire year or not), is valid.
But the real issue that Kessler takes with ED’s statistic concerns the comparison of those who are not working with only those who are working:
Second, on wages, the department is comparing apples and oranges. The Social Security earnings data obtained by the department includes people who are not working, which would bring down the average wages for programs. But the wage data for high school dropouts only counts people who are working — and it includes all high school dropouts, even people who left school decades earlier.
Kessler ruled ultimately that the idea of high school dropouts on average making more than graduates of for-profit education programs was a deceptive statistic designed to prove a point against for-profit education. In the article, he also provides research which shows that there was a 4 percent return per year of education from attending a for-profit college, which may have been missed by ED if they only looked at graduates recently out of their for-profit programs. While Kessler agrees with the general caution suggested by the Education Department, he sees no reason for deceptive statistics.
For more information, as well as the rebuttal from the Education Department, please visit: http://www.washingtonpost.com/blogs/fact-checker/wp/2014/04/11/the-obama-administrations-claim-that-72-percent-of-for-profits-programs-have-graduates-making-less-than-high-school-dropouts/
