Same Program, Different Results: Why the Gainful Employment Rule is Needed

The gainful employment rule data the Education Department released in January make clear that some federally funded career education programs are consistently leaving students worse off – drowning in debt they cannot repay – while many other programs are not. We’ve previously blogged about how bad some of these programs are.

We just put together examples of schools located near each other offering the same program with very different results. The examples illustrate that location and type of program don’t explain abysmal outcomes. They also underscore the continued need for the gainful employment regulation to provide key cost and outcome information to students, warn students about failing programs that may lose eligibility for federal funding, and ensure that failing and zone programs improve.

Amazingly, the for-profit college industry continues to defend programs that failed the gainful employment rule’s modest standards. The cosmetology trade association, for example, recently argued in federal court that a cosmetology program with a 14% job placement rate and a 100% borrowing rate should continue to receive unlimited federal funding. Why should taxpayers keep subsidizing such a program?

The gainful employment rule is based on the premise that students deserve basic information when deciding where to enroll, and that taxpayers should not subsidize programs that consistently underperform and leave students worse off than when they enrolled. This is just common sense, which is why so many student, veterans, consumer, civil rights, and other organizations, as well as state attorneys general, support the rule and oppose any effort to delay, repeal, or weaken it.