For-profit colleges still an industry in decline

Despite Devos efforts to boost troubled schools, “the tide is still going out”

WASHINGTON» The for-profit college industry is struggling under the weight of declining enrollment, stiff competition from traditional universities and an image battered by past misdeeds, even as the Trump administration tries to offer a helping hand.

Education Secretary Betsy Devos has hired several industry insiders and frozen Obama-era regulations that would have increased protections for students. She has reduced loan forgiveness relief for some former students defrauded by their schools, meaning that the for-profit industry could be on the hook for less. And she is considering reinstating an ousted oversight agency for many for-profit colleges.

“There is a serious attempt by this department to find that appropriate fair balance for both students and schools,” Steve Gunderson, president of Career Education Colleges and Universities, the industry lobbying group, said in an interview.

But Timothy Lutts, president of the Cabot Wealth Network in Salem, Massachusetts, sees an industry in decline. An improving economy has led to lagging enrollment as adult students return to the workplace instead of seeking a degree to burnish their resumes, he said. For-profit colleges now also compete with nonprofit schools that offer online degree programs without the stigma that still haunts moneymaking schools.

“It was a great sector a decade ago,” Lutts said. “For for-profit schools, the tide is still going out.”

Student enrollment at most four-year for-profit colleges fell in 2017 to just over 901,000, down nearly 69,000 from the year before, according to data compiled by the National Student Clearinghouse Research Center. It’s a downward trend that began in the fall of 2010.

The falling numbers have led to upheaval.

Adtalem Global Education in December unloaded Devry University by transferring ownership of the struggling school at no cost to a small for-profit education company in California. The move came a year after Devry agreed to a $100 million settlement to resolve a Federal Trade Commission lawsuit alleging the school misled students through deceptive ads.

Corinthian Colleges collapsed in 2015 and ITT Technical Institute a year later.