A Diploma From an Online For-Profit College May Keep You From Getting Hired
In terms of getting hired, a college degree is a college degree, right? Actually, employers are pretty discerning when it comes to the type of college you attended. We aren’t talking about Ivy League versus public university or community college. It turns out there’s a kind of diploma that may keep you from getting hired: one from an online for-profit college.
Economists from Harvard, UC-Berkeley, and the National Bureau of Economic Research (NBER) just put forth a working paper about how a diploma from a proprietary (aka for-profit) college seriously hinders graduates’ chances of receiving a callback from an employer.
Economists sent out about 9,600 phony resumes to job listings posted on a well-known job website. All of the job postings required four years of experience or less, to ensure that the employers were primarily looking at the applicants’ college experience. All of the jobs were in the business or healthcare industries. Some of the listings required a BA, some didn’t.
While the resumes were fake, they were meant to reflect the work experience of actual young workers, and listed real schools as education credentials. The resumes listed institutions from a range of public schools, as well as well-known for-profit institutions.
First off, getting a job right out of college is tough. It’s important to note that only 8.2 percent of all the resumes sent out received a callback from employers.
What researchers found is perhaps not shocking, but reinforces an urgent issue: graduates of for-profit, online institutions were 22 percent less likely than public four-year universities to land a callback for their resumes.
The results of this study imply that employers perceive a difference in quality between public universities and for-profits. This may stand to doubly hurt graduates of for-profit colleges, since this type of institution of higher learning costs significantly more than public schools….60 percent more, in fact.
For-profit colleges clearly aren’t good for getting hired, and recent light shed on companies like Corinthian have shown they are overall not good for students. Much of the current outstanding $1.2 trillion in student loan debt is attributed to for-profit schools, even though these institutions only churn out 5 percent of bachelor’s degrees.
Recently, for-profit colleges have grown. In 2002, for-profit bachelor’s degrees only totaled around 4,000, but reached nearly 75,000 in 2012. These figures do not even reveal the number of students who drop out, failing to complete their degrees.
This study supports the growing evidence that for-profits are not a worthy investment. Not only is it hard to get a callback or interview, for-profit alums that actually get hired make less money than their coworkers. According to Secretary of Education Arne Duncan, 72 percent of for-profit college graduates earn less than high school dropouts. President Obama’s gainful employment regulations for these colleges, along with federal report cards, aim to increase transparency and to identify bad actors. This study is timely in a moment when 40 million Americans hold student loans. Evidently borrowers attending or paying back their loans for for-profit schools probably will not be seeing a great return on their investment.