NCPA - National Center for Policy Analysis

Higher Education for Profit

August 7, 2003

For-profit universities have been expanding rapidly in recent years, although they still account for only 2 percent of college attendance. The "new" for-profit schools are accredited, multi-campus operations that offer traditional as well as online classes.

For-profit schools like DeVry and the University of Phoenix are popular with high school graduates and workers in mid-career who want to earn a technical degree in three years or less. For instance:

  • DeVry enrolls more than 50,000 students at 25 campuses in the United States and Canada, and 95 percent of DeVry graduates are employed six months after graduation in technical jobs with room for advancement.
  • Most DeVry student are from working-class backgrounds, and nearly half are nonwhite.
  • In fact, DeVry graduates more black and Hispanic electrical engineers than any other university.

There are limitations with for-profit schools, administrators admit. Graduation rates are low (about 40 percent at DeVry) because admissions standards aren't as high as for private colleges. Facilities are utilitarian, lacking gyms, student centers and even, in some cases, libraries. And tuition is often higher than at nearby regional universities, forcing DeVry, for example, to allot 10 percent of its budget for recruiting.

However, they are innovative. For instance, Kaplan, a division of the Washington Post Company, opened the first entirely online law school (Concord Law School) in 1998.

And in some specialties, they are pervasive. For example, American Schools of Professional Psychology (Argosy) award half of the all the psychology doctorates in the United States.

Source: David L. Kirp, "Education for Profit," Public Interest, Summer 2003.

 

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