Students at Connecticut’s for-profit colleges graduate at lower rates than their peers at public and private non-profit institutions. Those who do graduate carry higher levels of debt and higher default rates on that debt. Because African Americans and Hispanics are disproportionately enrolled in Connecticut’s for-profit colleges, these poor outcomes fall more heavily on people of color.
This report uses the most recent data released from the US Department of Education (College Scorecard, September 2016) to present a snapshot view of the condition of higher education within the state of Connecticut. It compares public, private, and for-profit institutions based on their average demographic makeup, completion rates, and indications of student financial burden after graduation.
Specifically, the Center for Responsible Lending finds the following:
- Disproportionate impact. The for-profit sector enrolls 11.1% of all Connecticut undergrads. For-profit enrollment at the institution level is disproportionately low-income (65%, as measured by the proxy Pell Grantees), African-American (18%), and Hispanic (23%) compared to public and private peers. This means the poor outcomes discussed below fall disproportionately on low-income communities and people of color.
- Lower graduation rates. Students at four-year for-profit schools have substantially lower completion rates (35%) compared to their public and private peers (55% and 67%, respectively).
- Higher debt burdens. For those who do graduate, for-profit students have substantially higher debt levels ($28,199 compared to $21,844 and $24,509 for public and private school peers, respectively). It is also notable that a greater percentage of undergrads borrow at for-profit institutions: 60.9% compared to 50.8% and 52.4% for public and private peers.
- Higher default rates. The higher debt levels contribute to another troublesome outcome: for-profit students have a default rate three times that of their public and private school peers (11.8% compared to 3.8% and 3.7% respectively). Further, after accounting for those students in default, only 59% of remaining students at four-year for-profit institutions are able to repay any of their debt three years after separation, compared to 88% for both public and private school peers. Similar discrepancies exist for low-income and female subgroups.