Get To College, Get A Job, Get Poorer: Students Are Worse Off After Attending For-Profit Colleges

Tyler Durden's picture

Go to college, study hard, get a good paying job - that's the mantra heard by most students across America as they wind down their high school careers.

Intuitively taking out loans just to go to college because everyone says so isn't a good idea, and a new study by the NBER finds that in fact, students who left for-profit schools during the 2006-2008 timeframe were worse off after attending. A key factor, as the WSJ reports, is that most of these students never earned a degree, they dropped out. Making matters worse, and certainly contributing to the fact that over 40% of student borrowers don't make payments, is the fact that these students borrowed to attend the colleges.

From the WSJ

The working paper, published this week by the National Bureau of Economic Research, tracks 1.4 million students who left a for-profit school from 2006 through 2008. Because students at these schools tend to be older than recent high-school graduates, they’ve spent time in the workforce. The researchers used Education Department and Internal Revenue Service data to track their earnings before and after they left school.


The result: Students on average were worse off after attending for-profit schools. Undergraduates were less likely to be employed, and earned smaller paychecks–about $600 to $700 per year less–after leaving school compared to their lives before. Those who enrolled in certificate programs made roughly $920 less per year in the six years after school compared to before they enrolled.


The key factor is that most of these students never earned a degree–they dropped out early. Excluding them, the minority of students who earned degrees saw an earnings bump after graduating.


“Certificate, associate’s, and bachelor’s degree students generally experience declines in earnings in the 5 to 6 years after attendance relative to their own earnings in the years before attendance,” write co-authors Stephanie Riegg Cellini of George Washington University and Nicholas Turner of the U.S. Treasury Department.


The picture is even worse when considering most students borrowed to attend the colleges. Nearly 9 out of 10 for-profit school students took on student debt; those in associate’s programs borrowed an average $8,000 and those in bachelor’s programs, $13,000.

And now we get to the main reason that more millennialls are living at home than any other time since the Great Depression:

“Examining the distribution of average annual earnings effects and average annual debt payments reveals that the vast majority of for-profit students experience both higher debt and lower earnings after attendance, relative to the years before attendance,” the authors write.

The study is being called into question by groups such as The Association of Private Sector Colleges and Universities, saying that the students that were tracked walked right into the Great Recession.

While that is true, the fact is that we're now in a "new normal", which is simply to say that lower paying jobs are being created and better paying jobs are disappearing, along with the overall opportunity to find employment - the results of the study are indeed indicative of what's going on in today's economy.

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Metalredneck's picture

Nobody wants to learn to binge-drink and be falsely accuse of rape at home.

grunk's picture

Like Kaplan University, which used to be owned by the liberal WaPo group?

WayBehind's picture

For profit? Isn't every college int the US a "for profit" institution? 

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) WayBehind Jun 3, 2016 8:02 PM

Based on the size of some university endowments someone is making bank by charging students to go to their school.

californiagirl's picture

Hillary likes to attack Trump over Trump University.  Well, what about her husband's time with Laureate Education Inc., which has way more complaints than Trump U? Not to mention that she funneled over $55 million in government grants to Laureate during her time in office, and millions more to another organization owned by the same guy. Laureate paid Bubba over $16 million to be their chancellor for a few years. Additionally,  Becker funneled millions back to the Clinton Foundation. Sounds like money laundering of taxpayer dollars into the Clintons' pockets to me, or payola for directing taxpayer moeny to his organizations

beemasters's picture

It's probably better off to study in better quality universities abroad where the costs are lower. It's another level of education entirely, plus it would be an added bonus to possibly learn a second language.

DetectiveStern's picture

The key is the only let the top 5/10% of students go to college. If they send every thicko to college it dilutes the value of the degrees.

Kirk2NCC1701's picture

"They are All Profit, No Prophet institutions." -Kirk

Hohum's picture

Trump University excepted.

Escrava Isaura's picture

It might be worse than as a university name.

American Caudillo 


didthatreallyhappen's picture

yeah, look at the awesome success of ivy leagers like barrack and michelle.  Read Michelle's thesis, you will laugh.

Cabreado's picture

Is this a high school thesis?

Congress has the power to shut down the "govt guaranteed" loan "programs" in a relative instant.
Does anyone remember Congress?

Meh... never mind.

But certainly you've all heard about the "government they deserved..."


"the fact is that we're now in a "new normal""

No, the fact is we are in chaos.


All Risk No Reward's picture

The government is a debt generating vassal of the Debt-Money Monopolist Mega-Corporacratic Fascist Overlords.

The government actually does produce something of value... debt "widgets" for Banksters... via force, fraud, and coercion.

Kirk2NCC1701's picture

Correct!  The part that only a tiny fraction of the US population is aware of, is that although other Developed countries have affordable world-class universities, few US high school grads will get accepted.


That is because the Public School system in the US has become soooo bad, that US high school grads are about 1-2 years behind those in most other countries. They just "Don't make the grade", you might say.


The US might be where you go for your Ph.D. or even Master's degree, but you get a better Bachelor's degree elsewhere. Ironically enough.


Which might explain why so many US companies prefer hiring an H1B1 student: better, cheaper.


Thought you should know.

All Risk No Reward's picture

Hi Kirk, all you say is true, but it is even worse than you explain. Operant conditioning schooling is what these institutions spew, NOT education. People are not trained to question authority and demand the data and logic that underlie what are factually BIG LIE Debt-Money Monopolist societal level claims... they are trained, like Pavlov's dogs, to go along to get along or get tarred and feathered.
So, yeah, foreign schools produce better operant conditioned "human resources" for the Debt-Money Monopolist Mega-Corporate Fascist system to leverage into more societal debt via debt-money fraud.
Whooooopeeeee! Ain't debt-money life grand?
And how many of these pseudo intellectuals are taught to be honest enough to understand the following applied middle school mathematics?
Money is lent into existence, it isn't printed.
If I loan you $20 @ 5% interest, in one year you will owe me $21 due to a double-entry bookkeeping adjustment that adds $1 interest liability to your balance sheet (the interest charge added to your statement) and a $1 interest asset to my balance sheet.
At the end of one year you will have $20, you will owe me $21, and I will control the $1 you need to pay me back.
Now, about that collateral for the loan you can't pay back because I duped you...
That is literally how fraudulent debt-money systems are.
Inequality: Why are the rich getting richer?
Debt Is Not a Choice
How To Be a Crook
Renaissance 2.0
Debunking Money
Krugman to Lietaer: "Never touch the money system!"
"You are killing yourself academically if you touch the money system."
~Paul Krugman
It is so much easier to "kill" ordinary people by not touching the generator of worldwide fraud, right Mr Fraudulent Fake Liberal Limp Wristed Lisping Goebbels Fascist Krugman?

CHoward's picture

I'm not convinced that going to a for profit college has anything to do about whether you get a job or not.  After all - we all know jobs aren't exactly every where you look. 

Krungle's picture

If we had a government with balls, they'd tell these banks that they were going to have to eat every last penny of student loan debt. Last time I checked the banks run the economy, so they're responsible for this entire shitshow. So they stopped the government from giving out college for free, and convinced the government to underwrite every loan, such that they're not on the hook for the bad debt, but they get to keep all the profit. They then squeezed out every decent paying job, while creating a system that requires various degrees and certificates in order to work. So, lets see if I got this straight: you can't get a job without going to college. Because of the "free money", colleges raised tuitions, so you can't go to college without borrowing. When you get out, you can't get a job. But you're still on the hook for the loan. Forever. It's bullshit, predatory lending and they've corrupted the system from every possible angle such that it can't actually work anymore. But, in the meantime, maybe we can get more of those divide-and-conquer propaganda pieces about college kids using student loan money to party or buy iPhones and then we can act outraged and surprised that people trained as consumers for 2 decades would consume when someone hands them a check and tells them they don't have to worry about paying it back for a few years. 

chunga's picture

Pretty much a bullseye right there. The only thing I'd change is - it's not a matter of gov balls or not*. Gov and the banks are on the same team and they're equally in on the fraudulent scheme.


* check the players, they bounce back and forth

Manipuflation's picture

I wonder how one could get fined for this...  I couldn't resist calling the state and asking.  Yes, I have been known to call and ask.  After ten phone trees where you press one for no help I finally got to a female person who promptly transferred me and put me on hold.  I got somewhere else and they give me a phone number to call.  I called that phone number and then got another press one for no service phone tree.  I held out and finally got to another female human being who transferred me to yet another female.  

My big question was what statute is this "law" a part of?  All I wanted to know is what statute I should look at to try to determine the intent of the law.  What could it be?  One woman tried to tell me that it was to control invasive species.  Really?  Even she figured out that it made no sense but could not tell me the statute.  She then asked me "Why would you even ask that question".  I made up a story about having a family reunion up on Gull Lake in Brainerd and that I had a good deal going on some leeches from a dealer I know.  It does not matter.  I only want to know the statute so that I can read it.  Oh hell no.  I dutifully stated that I was only trying to follow the law but that I was unclear on what the law actually was.

I was very polite and eventually I was told that I need to speak to a LEO about this matter and transferred again where I left a message.  Not suprisingly, I didn't get a call back.  

These people don't even know what the law is or why there is such a law or if there even is a law.  They don't count on people like me calling and asking questions but I was polite and not out of line.  All I asked is what statute that I might be violation of and no one could tell me.  That is a pretty simple question isn't it?  

Who are these people anyway?  You see this shit everywhere and I call just to question authority.  No one knows what the law is or even why it is the law.  It is futile for me to do that sort of thing in a way but in a way it isn't.  Someone has to do it.       


"Can I take my own minnows and leeches? Yes, if you have a fishing license, you can take an unlimited number of minnows and leeches for personal use only. However, you can only transport up to 12 dozen at a time."  
ali-ali-al-qomfri's picture

I'm sorry Sir but this is abviously a law under the jurisdiction of the Depatment of Transportation. Only 12 at a time, in an approved* container.

Please hold and I'll transfer you to the Dept of Transportation and Highways....







Lonesome Crow's picture



How is it that the signer who agrees to a contract is not responsible to abide by the contract that they signed?


The angst is properly directed but any voluntary agreement requires two participants and the shame may be equally shared depending upon the specific circumstances.

chunga's picture

It's a deal with the Devil.

Lonesome Crow's picture

A deal is a deal.

Reach for a scorpion, expect to feel the sting.

chunga's picture

I'd step on your scorpions. The banks conjure money from nothing and give it to anybody who doesn't have any while claiming to help them. Then they steal it back later.


The black hats are counting on people to focus on things like sanctity of contracts.

Lonesome Crow's picture

They give it to them?

...Cowachunga, dude.

chunga's picture

You are fucking dense. YES. Give it to them because they create it at will. In exchange for their debt servitude.


It costs them nothing you fucking dope!


Take your sanctity of your scruple bank moral hazard bullshit and shove it up your TARP fund.


Fuck you!

Peak Finance's picture



How is it that the signer who agrees to a contract is not responsible to abide by the contract that they signed?

Easy, when the contract is based on fraud. And believe me, it's fraud. It's a fucking joke. For profit students generally don't have the skills to handle "real" coursework so they are mostly passed through with inflated grades. The professors that teach these kids (Thats me) make less than minimum wage and therefore generally don't give a shit. It's a scam on everyone involved, the students are scammed, the less than minimum wage teachers are scammed, entire industry needs to be shut-down.

Lonesome Crow's picture

So if a contract is based upon fraud, why would one sign it? Is the refutation that the contract does not "appear" to be a fraud until later? The wits of all voluntary participants in the contract requires their wits!!!

What exactly is the deceit within the signed agreement?


All Risk No Reward's picture

The government has plenty of "balls." Forking over society this badly is a risky endeavor in the long term. That's why they've created the police state - for protection from the people they are pillaging on behalf of the Debt-Money Monopolist Mega-Corporacratic Fascist Overlords.

Pretending inferiority is an Art of War tactic documented by Sun Tzu.

fleur de lis's picture

Absolutely correct -- the whole edjakashun system is a scam. If the colleges are on the take for tax money, they need to be listed as to the success rate in job correlations.

If a major in 14th century basket weaving techniques only has a few job openings world wide per year, then that department does not need tax money. They can provide private scholarships.

If a majority students in any school / department cannot be placed within a reasonable time period, then the school department does not need tax money.
The schools have to do their part in job placement.

The schools have turned into tax funded retirement systems for teachers who teach subjects with poor job prospects. That needs to stop. There needs to be a review and forecast of future jobs openings before the various departments get mountains of tax money for nonexistent future jobs.

There also needs to be some way of refunding the students if a department has a particularly atrocious record of non placement. The banks and academies can duke it out as to who issues the refund checks. The graduates cannot be alone in shouldering a huge debt that was purposefully created by the banks and schools.

The schools and banks have no right to pass themselves off as educators if all they are doing is promoting nonexistent jobs and professions. By obstructing young people with massive debt thus preventing them from settling down and raising families the banks and schools only promote social decay everywhere.

This has got to stop.

All Risk No Reward's picture

>>Absolutely correct -- the whole edjakashun system is a scam. If the colleges are on the take for tax money, they need to be listed as to the success rate in job correlations. <<

fdl, it is even worse than that. Is education only successful when it prepares you to work WITHING the Mega-Corporate Fascistic system manifested by the Debt-Money Monopolists?

We are so forked.

It is the bigs vs everyone else... the only vote everyone else has to economically boycott the bigs. But that action is engineered to hurt and hurt badly (with higher prices, less convenience, etc...).

DontWorry's picture

For profit colleges are a rip off. This would never happen if student loans were dischargable in bankruptcy.


DrZipp's picture

If there weren't student loans college wouldn't be so expensive.

Lonesome Crow's picture

Need more info, please.

What is the drill down on degree paths that fail vs success?

e.g., Science and Tech vs Liberal Arts and General Business stuff?

HRH of Aquitaine's picture
HRH of Aquitaine (not verified) Jun 3, 2016 8:12 PM

I am guessing none of the "students" realized that once they cashed that check they gave the IRS the right to confiscate part of their income in order to re-pay that student loan. The IRS doesn't care if you graduate or not. Oh, and good luck declaring that student loan as a bad debt on a bankruptcy. They can't.

Monetas's picture
Monetas (not verified) Jun 3, 2016 8:01 PM

We so need ... to rediscover our slave owners .... great Patriarchs .... who knew how to educate, feed, clothe and get value out of indigenous  Africans .... like no one ever has .... where would we be now .... if we let the slave door to citizenship .... run it's course .... we'd be so far ahead of where we are ?

Paul Kersey's picture

Profit schools aside, what about run of the mill state universities?


East Carolina University is a North Carolina state run school. The yearly out of state cost to attend is $29,964. So why does this run of the mill school cost this much? Well, this will give you an idea of how much they pay administrators. Assistant Professors make $77,490. Clinical Assistant Professors make $158,143. Associate Professors make $137,002. Professors make $130,629. And Margaret Spellings, the University President makes $775,000 a year.



Lonesome Crow's picture

Do they "make" that much a year or are they "allocated" that much a year?

fleur de lis's picture

Is there a graduate job placement rate? That should indicate whether the tuition is worth it.

Monetas's picture
Monetas (not verified) Jun 3, 2016 8:28 PM

German, Russian, American, Italian, Japanese, Vietnamese POWs went home when they were freed .... freed slaves just hung around the kitchen door .... like Obama staying on in DC .... get a life .... show us you're not what we fear ?

Swamidon's picture

The whinning and crying never stops with the Millennials, wailing like little girls to distract from their shortcomings and responsibility for them.   If I were 25 years old there's a dozen good paying jobs I'd pursue and I'd get one too because my father raised me smart and able and hardworking and whinning and crying got a beating every time and that made the difference between being a winner or a loser for life.  

Lonesome Crow's picture



You mean to say that you would not "take" a loan "given" to you for which you were not obligated to repay other than the pesky contract signed, and, you, you, an establishment knave, a ne'er-do-well, would rather learn a skill, bottoms up, entry-level and all, a skill, say you, to be acquired from experience for which none could ever sever from your soul and bones, a skill to centralize your economic gravity, an education of your own volition? YOU? Petty, Petty, picayune you, without a bank to bid your biding? You? a learned one of skill? THIS is what you say????


... Sure, you do. For is there not a road not taken?

Swamidon's picture

If the one skill you learn is to how win when all about you are being turned into losers and little girls.  Winners and Losers shake out early in life.   Try the High Road for a change.   23 years to pay off my student loan and I didn't like it either..

Omen IV's picture

Ace - the cost of an education and the associated loans are outrageous.  The quality of the education received is marginal. So these people are being systematically ripped off.


Those facts escape your interest

Swamidon's picture

The problem is not education, or the lack thereof, the basic problem is failing to learn to think... but learning to think is the individuals responsibility and one of the many reasons Millennials are failing so badly is because they take no responsibility for their miserable decisions.   The schools programed them to fail and as all can see, they're doing a great job at it.   In future generations mothers will warn their children to study hard and work hard for fear of becoming a Millennial.  

bobbyjohnson's picture

i completely agree with everything you just said.


fraudulent or not fraudulent if you sign a dodgy deal you pay for the stupidity.


i'm a brit about 18 years of age and wouldn't even touch university with a 10 footpole in this counry our loans are tied to inflation fucking inflation lol and people have decided to take them out when we're on he precipice of going into hyperinflation like really...... so my moto is you reap what you sow. there have even been some recent grads who are  bitching about fees being to high or protesting for free education.... yeah right suck it up!!! once the reality of declining job prospects hit home im sure they'll be raking that interest payment like a bitch sitting at home for working in a field that does not relate to their degree.


sameway i'm sure my mother wouldn't sign a frauduent contract and if you don't know if it is or not then do some fucking research we don't live in the information age for nothing!!!

thumbs up from my side and just my two cents

bobbyjohnson's picture

i completely agree with everything you just said.


fraudulent or not fraudulent if you sign a dodgy deal you pay for the stupidity.


i'm a brit about 18 years of age and in this counry our loans are tied to inflation fucking inflatio lol and people have decided to take them een when we're on he precipice of going into hyperinflation like really...... so my moto is you reap what you sow


sameway i'm sure my mother wouldn't sign a frauduent contract stating to give over her house to xyz person for nothing in return for them.

RSDallas's picture

I'm not buying this crap! The headline should read, "Get to College, Take the time to actually study, quit your freaking wining, suck it up and make something happen, but more than anything, quit making up the excuses that empower you to fail!

oncemore's picture

The system is bent that way.

Even the Church is pro-profit.