THE BLOG

Gainful Employment?

08/17/2010 10:12 am ET | Updated May 25, 2011
  • Randy Proto President, American Institutes school group

Millions of college students are getting ready to go back to school. Millions more adult students attending year-round institutions are about to enter their next term. Among the common questions: Will this all be worth it? Having a clearer picture would sure be nice.

The U.S. Department of Education is trying to give students that clearer picture and protection from making what it deems could be wrong choices. How? With its new regulation called "Gainful Employment."

It would apply a formula to programs in career-oriented majors, like healthcare, business and education to name a few, to decide which ones lead to 'Gainful Employment.' Those that do not would be eliminated. Students would also get concrete information about graduation rates, employment rates, potential salaries in their chosen field, loan debt info and the like before they choose their school. This information should help students analyze their risk/reward scenario.

The disclosure requirement is an excellent idea; it helps students compare their options. It
should be implemented at all schools. As for setting standards to see if programs yield Gainful Employment? It could be a good idea, if the regulation's measurements and mechanisms are derived correctly. But that's not easy.

For example, one key factor in recent draft regulations - a specially calculated federal student-loan repayment rate - shows many fine and varied institutions from Alabama State University to Harvard University Medical School dramatically failing that metric. This points to the proposed approach being somehow flawed.

To be crafted correctly, the formulas or other measures established must account for differences in: student populations served, programmatic goals, national economic conditions and many other factors. The regulation must provide a path for viable programs to improve performance quickly. Otherwise, it will eliminate needed educational capacity, only to have to fund immediately rebuilding it.

It's a difficult policy discussion, with high stakes for the workforce, students, institutions and our economy. The end result will be a defining moment in higher education policy and have broad and enduring implications for students and the economy.

But, let's assume functional metrics and measurement tests can be crafted. That would be a great protection for all students, right? Not exactly. As it's currently envisioned, this regulation will only apply to students attending for-profit career colleges and to the small percentage of other students enrolled in non-degree programs at public and private colleges and universities.

That leaves roughly 7.5 million additional students enrolled in career-oriented degree majors at public and private institutions out of the mix, and devoid of its protections. Why leave any students and programs out of its reach? If the proposed regulation is a good idea and provides the anticipated benefits and protections, it should be broadly applied.

All students with career majors are entitled to "Gainful Employment," however it's ultimately defined --and should be covered by it. Why? Because the vast majority of students who choose career-oriented majors instead of academic majors do so to find employment in the field in which they have been educated, or a related one.

It makes sense that if programs don't operate at a reasonable rate of success for the populations they serve and with an appropriate benefit to students and society, then they should not be supported by taxpayers.

But creating metrics that are required of only some institutions while others are permitted to fail them with no penalty will result in unintended consequences. That approach will certainly entrench some interests and disenfranchise others. In the end, the very constituents Gainful Employment is supposed to protect- students and taxpayers alike - will be the ones hurt the most by a flawed or selective implementation.

Education reform is difficult. And while we all like simple solutions, they rarely work in complex situations. Robert Zemsky, a participant on the Spellings Commission, writes that reform requires one or more "dislodging events." With so many entrenched interests, events must affect the vast majority of institutions to be catalysts for positive change.

Gainful Employment can be the basis for a meaningful discussion of improved effectiveness and better disclosure of outcomes and other important information throughout post-secondary education. A variation of it could empower all students with career-oriented majors to make better choices among a strengthened, more transparent mosaic of schools.

This is a real opportunity for higher education. But only if it is 'Gainful Employment' for all students.

Randy Proto is the President and CEO of the American Institutes school group, which specializes in health-care career education and serves over 2,000 students annually. It includes the American Institute College of Health Professions, American Institute and American Institute School of Health Careers located in Florida, and the Fox Institute schools in Connecticut and New Jersey.

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