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Today the education policy program at the new America foundation is releasing "Improving Gainful Employment." This policy brief lays out recommendations for strengthening the Obama Administration's proposal to ensure that career training programs are providing students high-quality options that lead them into good-paying jobs at a reasonable price, not over indebted with minimal job prospects.
The brief is in response to a proposal released this August and subsequent regulatory work by the U.S. Department of Education to define what it means for programs at institutions of higher education to prepare students for "gainful employment in a recognized occupation." This is a statutory requirement within the Higher Education Act that applies to nearly all programs at for-profit colleges as well as some non-degree programs at public and private nonprofit institutions. The Administration proposes to create a stronger definition for what this phrase means due to concerns about excessive debt levels, low economic returns, and high levels of non-completion and student loan defaults among these career-oriented programs.
The proposed definition laid out by the Department is the second attempt to define what gainful employment means after a judge's ruling in 2012 invalidated the prior regulation hours before it was going to take effect. The new proposal from the Department is a simpler and stronger version of what was created the last time.
But the Department's proposal contains potential loopholes, which if left unaddressed could undermine the rule's effectiveness, allowing programs that are not serving students well to keep operating. This brief addresses those challenges by laying out recommendations for the Department and others involved in the regulatory process to adopt in order to strengthen the rule. Among the highlights:
Through this proposal, career-oriented programs would need to focus on all the students they serve, not just graduates but potential dropouts too. It also acknowledges that programs should not pass if they have low levels of student debt and lack sufficient earnings. After all, student debt is just one type of investment in a program--students are also spending billions in federal grant aid and arguably an even more precious resource, their time. They should expect better than living in or near poverty after completing a postsecondary program.
The President has been very clear that he wants to stop providing federal support to schools that are not producing good results for their students. The recommendations presented in this brief ensure that promise is delivered upon for career oriented programs, a part of higher education with some of the worst results for students.
To read "Improving Gainful Employment," click here.