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Who is targeted by for profit colleges?

March 27, 2018

From report “Private equity’s failing grade: Private equity investment in for-profit colleges

(Written jointly by Private Equity Stakeholder Project and Americans for Financial Reform)

The impact of the for-profit college sector, including for-profit colleges owned by private equity firms, is not distributed equally. Students from low-income backgrounds and students of color, particularly African-American and Latino students, make up a disproportionate share of for-profit college students.[i]

A 2014 paper by the Leadership Conference on Civil and Human Rights showed that African-American and Latino students are over-represented in for-profit colleges, making up 41 percent of the student body.[ii] This over-representation was even more extreme at the for-profit giant Corinthian Colleges: an analysis of Corinthian’s 2014 enrollment numbers shows that people of color comprised the majority (62 percent) of its students, women comprised 71 percent of its students, and African-American women comprised 26 percent.[iii]

A 2014 study by the Center for Responsible Lending showed that over one-quarter (28%) of African-Americans enrolled in a four-year institution attend a for-profit college, compared with just 10% of whites. A 2016 Brookings Institution study reported that for-profit students have the lowest average annual household income, at just $28,530, significantly lower than public two-year (e.g. community college) students ($41,718) and other public and non-profit colleges and universities.[iv]

For-profit colleges also have a higher proportion of female students than public and non-profit colleges and universities.[v]

In addition, for-profit students are almost twice as likely to have served in the military.[vi]

For-profit colleges also disproportionately enroll low-income students, older students, and single parents.

[i]“Do Students of Color Profit from For-Profit College?” Center for Responsible Lending, Oct 2014.

[ii] Leadership Conference on Civil and Human Rights, et al, “Gainful Employment: A Civil Rights Perspective,” October 2014, available at http://www.protectstudentsandtaxpayers.org/wp-content/uploads/2014/10/Gainful-Employment-Civil-Rights-Perspective_WhitePaper_October2014.pdf.

[iii] Analysis of National Center for Education Statistics, “Integrated Postsecondary Education Data System,” available at https://nces.ed.gov/ipeds/datacenter (last accessed October 2016), examining 12-month 2014 enrollment by race/ethnicity.

[iv]“Different degrees of debt: Student borrowing in the for-profit, nonprofit, and public sectors,” Brookings Institution, June 2016.

[v]“Different degrees of debt: Student borrowing in the for-profit, nonprofit, and public sectors,” Brookings Institution, June 2016.

[vi]“Different degrees of debt: Student borrowing in the for-profit, nonprofit, and public sectors,” Brookings Institution, June 2016.

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