The U.S. economy will create 55 million job openings between now and 2020, according to a new study from Georgetown University's Center on Education and the Workforce. Roughly 65 percent of those jobs will require at least some college credits, the study found. A bachelor's degree will be a minimum requirement for 35 percent of job openings. Given current rates, the economy will face a shortfall of 5 million workers with some higher education.
Ashford University has begun a voluntary buyout program for non-faculty employees, said a spokeswoman for Bridgepoint Education, which owns the for-profit institution. Enrollment has tumbled at the university, which is also grappling with uncertainty about its regional accreditation. To reduce class sizes, Ashford has hired more faculty members while eliminating all of its teaching assistant positions, according to the company. Next month the Western Association of Schools and Colleges is expected to publicly announce whether Ashford has succeeded in a revised accreditation bid. The university's current regional accreditor is the Higher Learning Commission of the North Central Association of Colleges and Schools.
Lincoln Educational Services this week announced that it will close five campuses in Ohio and Kentucky. The for-profit institution, which offers automotive technology and other academic programs, said legislation Congress passed last year to eliminate federal aid for "ability to benefit" students had resulted in dramatic enrollment declines at the five locations. That legislation prohibits students who lack a high school diploma or its equivalent from participating in federal aid programs. Shaun McAlmont, Lincoln's CEO, said in a written statement that the company was saddened that those students "continue to be marginalized by legislation that treats them differently than so-called 'traditional' students."
A jury in Missouri last week awarded $13 million in damages to a former student of Vatterott College who claimed the for-profit institution had misled her, The Kansas City Star reported. The jury found that Vatterott, which is based in Missouri and owned by a private equity firm, gave inaccurate information about a health care degree program to Jennifer Kerr, a 42-year-old former student. Kerr was awarded $27,000 in actual damages, with the rest of the $13 million being "punitive damages," according to the Kansas City Business Journal. A statement from the college said: "We cannot comment on pending litigation. We are confident at Vatterott that our systems and admission processes are handled professionally. Our mission is to transform and better the lives of our students through quality, career education. We are proud of this mission and will continue to pursue it with professionalism and integrity."
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Senator Dick Durbin, an Illinois Democrat, was sharply critical of the for-profit sector during a hearing Wednesday of the Senate Appropriations Subcommittee on Defense. The hearing was on the U.S. Department of Defense's tuition assistance program for members of the U.S. military. Durbin, who has tangled with for-profits before, grilled Frederick Vollrath, the assistant secretary of defense for readiness and force management, over the Pentagon's oversight of the program. For-profits received half of the $660 million the federal government spent on military tuition assistance last year. Yet Durbin said only 200 department counselors are on hand to help the 200,000 military students who receive tuition assistance. And he said the department audits only 1 percent of participating colleges each year.
Western International University, a for-profit institution owned by the Apollo Group, has slashed its tuition by 51 percent. The university's bachelor's degrees, which are aimed at working adults, will cost $30,400. Master's degrees will be $11,950. Western, which enrolls 2,500 students, is also offering a "test drive" in which the first two online courses will cost $200 each. Several for-profits have cut prices recently amid slumping enrollments, including ITT Technical Institute and Strayer University.
The U.S. Department of Education plans this fall to begin a stand-alone round of negotiated rule making on "gainful employment" regulations, which would keep tabs on vocational programs at for-profit colleges and some nonprofit institutions. The department's plan to pursue a new set of regulations, given that a federal judge struck down the original version last year, is not a surprise. But in an announcement in the Federal Register this week, the Education Department said it planned to hold separate discussions on gainful employment this fall, rather than as part of a broader rule-making session that might also tackle fraud protection or state authorization of distance education.
The federal court ruled that the department had failed to adequately establish justification for the threshold it set for loan repayment rates. (The other standards dealt with debt-to-income ratios.) However, the judge said the department was on firm ground philosophically in its effort to regulate the return on investment of vocational programs. But the Obama administration appears to have chosen to take another run at crafting a new set of rules rather than trying to resuscitate the old ones in court.
Gainful employment was a long, bruising battle. For-profits and some Republican lawmakers had asked that a new debate over how to regulate vocational programs be folded into the renewal of the Higher Education Act, which is scheduled to expire this year. By pursuing a new round of rule making on gainful employment, the department appears to be continuing to focus primarily on for-profits , in contrast to proposed legislation that would scrutinize employment outcomes of higher education more broadly. The Association of Private Sector Colleges and Universities, the sector's primary trade group, issued a written statement saying it was disappointed by the prospect of a "repeated, faulty and confrontational process" on gainful employment. The department will select members of the committee, which is slated to meet first in September.
The Securities and Exchange Commission is investigating Corinthian Colleges Inc., the for-profit chain disclosed Monday in a corporate filing. In a subpoena, the commission requested documentation relating to student recruitment, attendance, completion, placement and defaults on loans, according to the company, as well as information about compliance with U.S. Department of Education financial requirements.
American Commercial Colleges, a for-profit higher education business in Texas, has agreed to pay the federal government up to $2.5 million to settle claims that it falsely certified that it was in compliance with certain requirements to receive federal student aid. A statement on the settlement from the Justice Department said that American Commercial Colleges had "orchestrated certain short-term private student loans" that the college repaid in order to appear to comply with the "90/10" rule. That rule requires that colleges seeking to participate in federal student aid programs receive at least 10 percent of their revenues from sources other than federal student aid. H. Grady Terrill, a lawyer for American Commercial Colleges, told The Lubbock Avalanche-Journal that he anticipated the institutions soon reapplying for authority to operate.