About Career Education
The Career College Sector in America:
Meeting the Needs of the 21st Century Workforce
Background Questions and Answers
What is a career college?
What areas of study are offered by career colleges?
What is the Career College Association?
Why enroll in a career college?
What is the mission of career colleges?
How big is the career college marketplace?
Who attends career colleges?
How do career college graduation rates compare to
traditional schools?
How do career college tuition costs compare to traditional
schools?
What is the student’s return on investment for a
career college education?
How do career college students finance their
education?
How do career college student loan default rates compare
with other student loan default rates?
How do career colleges impact the U.S. economy?
What is the projected demand for a career college
education?
How are career colleges accredited?
What are the placement rates for career colleges?
What is a career
college?
A career college is a postsecondary institution that provides
professional and technical, career-specific educational programs.
Most career colleges pay taxes yet receive no direct financial support
from state governments, unlike public, not-for-profit public
institutions that receive state tax support or not-for-profit private
colleges that pay no taxes. Completion of a career college program can
range from doctoral and master’s degrees, to bachelor’s
degrees, to associate degrees, to short-term certificates and diplomas.
Career colleges are owned and operated by private individuals, private
investors and public corporations.
What areas of study are offered by
career colleges?
Career colleges provide educational programs in over 200 occupational
fields, including accounting, allied medical, automotive technology,
business administration, commercial art, criminal justice and law
enforcement administration, culinary and hospitality management,
emergency medical technology, information technology, interior design,
legal administration, mechanical engineering, network administration,
nursing, radio and television broadcasting, and visual and performing
arts.
What is the Career College
Association?
The Career College Association (CCA), with over 1,500 members, is a
voluntary, Washington, D.C.-based membership organization for private,
postsecondary schools, institutes, colleges and universities that focus
on the career oriented sector of higher education. Career colleges
educate over two million students each year.
All CCA members must be licensed by the state in which they are
located; accredited by a national or regional accrediting body approved
by the U.S. Department of Education. Many also participate in other
federal, state and local education and workforce training programs.
CCA serves its members by promoting access, accountability and
excellence in career and professional higher education. Principal
CCA programs focus on public policy advocacy, sector promotion and
research, and professional and business development. The CCA
Annual Convention and Exposition attracts over 1500 attendees; the
organization holds other events throughout the year, including an
Investment Conference and Public Policy Forum and Hill Day.
CCA governance is provided by a board of directors composed of 16
members. Rene Champagne, ITT Educational Services, is Board
Chairman. Jonathan Liebman, Specs Howard School of Broadcast Arts
is Vice Chairman. Francis Voigt, New England Culinary Institute,
is treasurer. Harris N. Miller is president of CCA, overseeing the day
to day operations of the organization. CCA maintains a
professional staff of over 25.
Why enroll in a career
college?
The focus of employers today is on skills. Eight of the 20 fastest
growing occupational categories between 2006 and 2016 require less than
a four-year degree.1 The government forecasts
that four of the fastest growing occupations require an
associate’s or two-year degree, another five a four-year degree,
including the top of the list occupation in network systems and
communications, and three post-graduate degrees.2
In the period 2006-2016, a 16.7 percent increase in the number of
professional and related occupations is projected accounting for 5
million jobs, most in three occupational groups – computer and
mathematical occupations, healthcare practitioners and technical
occupations.3
Career colleges focus on the needs of both students and employers.
Many offer online courses of study, flexible course schedules and
accelerated completions to meet the needs of working adults juggling
study, full time employment and personal commitments. Many career
colleges also have business advisory councils that help shape curricula
and develop programs to meet growing and shifting workforce demands.
What is the mission of career
colleges?
The 21st Century workforce demands highly skilled workers, and career
colleges are well positioned to educate Americans for information age
jobs. Jobs in information technology, accounting, finance and
engineering are regularly being outsourced overseas because there are
not enough skilled workers to meet U.S. demand. Seventy-seven
million baby boomers are beginning to retire, and the U.S. health care
infrastructure is badly understaffed to meet a tidal wave of seniors
requiring acute, post-acute, chronic and rehabilitative care.
Career colleges are a key piece of the education and skill
development puzzle. They adapt to market needs more quickly than
traditional institutions and maintain much higher graduation rates than
community colleges. While traditional colleges and universities
often help students gain broad background in the liberal arts,
“find themselves” in personal terms, explore intellectual
interests or perform research, career colleges serve individuals who are
committed to a specific occupational goal and seek the most direct route
to reaching it.
How big is the career college
marketplace?
Nearly two and a quarter million students attended accredited career
colleges in 2006-2007, which represents 9% of the total market of 25
million students. Enrollment at career colleges between 2003-2004
and 2006-2007 increased 12% in less-than-two-year programs, 18% in 2-4
year programs and 48 percent in 4-year or more programs.4
Who attends career
colleges?
Career college students are predominantly working adults looking to
achieve the American dream by obtaining an education directly related to
their career goals. Forty-three percent are minorities and almost
50% are the first generation in their families to pursue higher
education. Over 50% of dependent career college students come from
families with an income of less than $40,000. More than 75% of the
students are employed while they are enrolled in career
colleges.5
How do career college graduation rates
compare to traditional schools?
According to the U.S. Department of Education’s National Center
for Education Statistics, 62% of career college students who attended
2-year and less-than-2-year institutions graduate within six years of
enrolling. At community colleges, over the same time span, 38% of
the students graduate and 46% drop out.6
How do career college tuition costs
compare to traditional schools?
Every college is different, of course, and tuition will vary depending
on such factors as degree focus area, local economic conditions, student
demand and the like. As a general rule, career colleges are more
expensive than community colleges and public four-year institutions and
less expensive than private non-profit colleges and
universities.
What is the student’s return on
investment for a career college education?
In salary terms alone, in 2007, the median annual earnings of working
career college students 25 years and older with some college or an
Associate’s Degree was $40,769 versus $32,862 for their high
school graduate counterparts). The average rate of return on a
career college student’s investment is 24%.7
How do career college students finance
their education?
Career college students often finance their education with a combination
of Federal (Pell Grants) and state and local government grants,
government subsidized and unsubsidized loans (Stafford Loans) and
private banking loans. Unfortunately, federal and state support for
higher education has not kept pace with inflation and the difference
between Pell Grant and Stafford Loan funding amounts and tuition and
related costs can leave a funding gap. This gap can be addressed
by PLUS Loans, where parents agree to co-sign for the student,
commercial market loans and self financing.
How do career college student loan
default rates compare with other student loan default
rates?
Career college default rates are slightly higher than default rates for
students at community colleges, four-year public colleges and
universities and private non-profit colleges. According to the
U.S. Department of Education, “proprietary” school students
in 2006 had a loan repayment default rate of 9.7%, compared with 4.7%
for students at public institutions and 2.5% at private colleges and
universities. The higher default rate reflects the fact that
career colleges serve a substantially greater percentage of students
coming from low income circumstances.8
How do career colleges impact the U.S.
economy?
Career colleges make an important contribution to the American
economy. They operate as tax paying businesses that put dollars in
the economy of every state and community in which they are
located. In addition, their graduates earn more, spend more and
pay more taxes than would be the case if they had not received training
beyond high school. A May 2007 report from the Imagine America
Foundation concluded that private career colleges contributed $38.6
billion to the U.S. economy in 2005. This includes $14.6 billion
in direct institutional expenditures and $4.0 billion spent by students
on expenses other than tuition required to attend the
institutions. In addition, the sector generated $3.5 billion in
secondary earnings gains, defined here as the increase in career college
graduate salaries, and $16.5 billion in indirect economic activity
associated with the industries in which graduates are
employed.9
What is the projected demand for a career college
education?
The U.S. Census Bureau reports that in 2007 only 27.5% of Americans held
college degrees. While this is a record high, the percentage is
expected to climb.10 According to the U.S.
Department of Education, between 2006 and 2017, postsecondary enrollment
is expected to increase 9.6% for those under 25 and 18.5% for those 25
years of age and older.11
How are career colleges
accredited?
Title IV eligible career colleges can be nationally or regionally
accredited. Accreditation is a condition of CCA membership.
However, many career colleges are not accredited and are not CCA
members. Leading national accreditation organizations are the
Accrediting Commission of Career Schools and Colleges of Technology
(ACCSCT) and the Accrediting Council of Independent Colleges and Schools
(ACICS). There are six major regional accrediting
organizations. Many career colleges are accredited by multiple
bodies.
Accreditation involves an in-depth assessment of an
institution’s compliance with educational standards. The
review examines the school’s infrastructure and resources for
delivering higher education and, in the case of national accreditations,
its ability to produce satisfactory educational outcomes. In terms
of the former, such a review covers the adequacy of faculty, curriculum,
facilities and equipment, admissions practices, retention, financial and
administrative capabilities, and student services. Outcomes
include factors such as program completion and job placement rates,
graduate performance on state licensing examinations, and student
satisfaction.
Accreditation of an institution can take up to two years and costs
several thousand dollars to complete. The accreditation process
involves both self-reporting and on-site visits to the institution by
accreditation body personnel. Accredited institutions must comply
with all federal, state and local requirements and be financially sound,
audited and reviewed by an independent certified public
accountant. The institution must file an annual financial
statement with the accrediting body.
What are the placement rates for
career colleges?
Placement rates for individuals completing programs at career colleges
are high. One of the national accrediting bodies (ACICS), which
accredits over 700 institutions whose enrollment in 2008 was nearly
600,000, collects such information. It reported that in 2008, of over
117,000 completers and graduates, over 69,000 were placed in their field
of study and over 10,000 were placed in a related
field.12 Seventy-six percent of those earning an
occupational associate’s degree found employment in 2008,
according to ACICS, while 72 percent did so with academic
associate’s degrees, 65 percent in bachelor’s degree
programs and 76 percent in master’s degrees programs. Placement
rates for certificate and diploma completers were over 72
percent.13
The Career College Association
1101 Connecticut Avenue, NW
Suite 900
Washington, DC 20036
www.career.org
202-336-6700
Footnotes:
1 Tomorrow’s Jobs: Reprinted from the
Occupational Outlook Handbook, 2008-09 Edition, U.S. Department of
Labor, Bureau of Labor Statistics, Chart 7, p. 6 and Table 1, p. 10.
2 Ibid., p. 6.
3 Ibid.
4 U.S. Department of Education, National Center for
Education Statistics, Integrated Postsecondary Education Data System
(IPEDS), Table 15, Total unduplicated headcount enrollment at Title IV
institutions, by student level, sector, race/ethnicity, and
gender: United States, academic years 2003-04, 2004-05 and
2005-2006 and Table 8, academic year 2006-07.
5 U.S. Department of Education, National Center for
Education Statistics, “National Postsecondary Student Aid Study
2003-2004” (NPSAS: 2004).
6 U.S. Department of Education, National Center for
Education Statistics, 1995-96 Beginning Postsecondary Students
Longitudinal Study, Second Follow-up (BPS: 96:01).
7 U.S. Census Bureau, Educational Attainment in the United
States: 2007, January 2009, P20-560,
Table 3: Median Earnings for Workers Aged 25 and over by Educational
Attainment, Work Status, Sex, and Race and Hispanic Origin, 2007, p.
9.
8 Information for Financial Aid Professionals (IFAP), Direct
Loan and Federal Family Education Loan Programs, Institutional Default
Rate Comparison of FY 2004, 2005, and 2006 Cohort Default Rates,
September 2008; http://www.ed.gov/offices/OSFAP/defaultmanagement/instrates.html
9 Imagine America Foundation, Economic Impact of
America’s Career Colleges, May, 2007, Table 1: Total Annual
Economic Impact of Career Colleges, p. 6.
10 U.S. Census Bureau, Educational Attainment in the
United States: 2007, January 2009, P20-560,
Table 1: Educational Attainment for the Population Aged 25 and Over by
Age, Sex, Race and Hispanic Origin, and Nativity Status: 2007, p.
3.
11 U.S. Department of Education, Digest of Education
Statistics 2008, Table 190. Total fall enrollment in degree-granting
institutions by sex, age, and attendance status: Selected Years,
1970 through 2017. http://nces.ed.gov/pub2009/2009020.pdf.
12 Accrediting Council for Independent Colleges and
Schools, Educating America’s Workforce, Summary of Key Operating
Statistics, Data Collected from 2007 and 2008, 2008 Placement Data, p.
11. http://www.acics.org/publications/content.aspx?d=1452.
13 Ibid, Retention Data, p. 8.
