Explosive for-profit school report details horrific exploitation

Senator Harkin completed a massive report on the state of for-profit schools in the United States titled For Profit Higher Education: The Failure to Safeguard the Federal Investment and Ensure Student Success. The New York Times and the Washington Post both have coverage. There are so many terrible things going on in for-profit schools that one blog post cannot suffice. Here, I want to go over perhaps the most emotionally inflammatory part of the report: recruitment strategies. I do not even need to provide much commentary on this part of the report: just quoting and paraphrasing should provoke enough outrage.

First, the report finds that for-profit schools regularly target vulnerable populations.

For instance, Vatterott’s [a for-profit college] internal “Student Profiles,” part of a manual to train recruiters, detailed the demographic subgroups that the company targets for enrollment: “Welfare Mom w/Kids. Pregnant Ladies. Recent Divorce. Low Self-Esteem. Low Income Jobs. Experienced a Recent Death. Physically/Mentally Abused. Recent Incarceration. Drug Rehabilitation. Dead-End Jobs-No Future.”

The report also shows just how well these colleges regard the vulnerable populations they trick into enrolling. The Vatterott’s training material apparently included this gem, which the report describes as “a number of quotes ostensibly from administrators and teachers:”

“Lately it seems admissions has been putting in some really troubled people . . . could this be a trend?,” “the last batch of students you guys dumped here are about the worst I’ve seen in years,” “Do your ads say, LOSERS ENROLL HERE!” The next page answered these quotes with, “These Students Are The Reason We’re in Business!”

In targeting these vulnerable populations that they internally regard as scum, the recruiters at for-profits use tactics designed to provoke pain. Here is a training slide that ITT uses:

The goal of this technique is to make the student feel vulnerable, highlight problems in their life — things like the inability to support their children or how they have let down their parents — and then sell the school as the solution to whatever problems are identified. In their training materials, ITT provides this helpful guide called the Pain Funnel:

Interestingly, the recruiter that came up with the pain funnel submitted it to headquarters for an award consideration. She explained that the “proper usage of this tool can bring a prospect to their inner child, an emotional place intended to have the prospect say yes I will enroll.”

All of this just constitutes one part of the recruitment process. There are also methods for overcoming objections, quota systems that create boiler room pressures that force recruiters to find more suckers, and techniques to create urgency around the necessity to enroll right away.

This sort of thing is done throughout the for-profit college sector, whose publicly traded companies have an average profit margin of 19.4 percent, and CEOs making an average of $7.3 million per year. More than half of the students drop out before receiving a degree; more than half that graduate with Bachelor’s degrees have over $30,000 of debt; and, 22 percent of graduates default on their loans within 3 years of entering repayment. Of students that attended for profits in 2008-2009, 23 percent were unemployed and seeking work. Oh, and huge chunks of this is financed with federal educational grants and loans.

The for-profit college sector is pulling off perhaps the most blatant exploitation scam in the country right now. Poor people and other vulnerable populations are manipulated into loading themselves down with debt to go to a school that spends barely any money on instruction, only to either drop out or graduate with huge debt and high unemployment. It really is stunningly cruel.