Transcript
This transcript was generated using artificial intelligence (AI) technology.
Jason Altmire (00:00)
Hello and welcome to another edition of Career Education Report. I'm Jason Altmire. We're going to talk about the accountability regulations that are nearing the final stages here. And one of the biggest issues that has surrounded those accountability regulations that are coming out of the U.S. Department of Education involves the beauty and wellness sector, cosmetology, estheticians, massage therapy, nails, things like that.
And we have brought on today because it is such a hot topic in higher education. And there's been a lot of conversation I wanted to do. We've never done this. We've done about 110 episodes or so. We've never had three guests on before. I think we might've had two, but I wanted to bring a diverse group from within the beauty and wellness sector to talk about these really big issues that are very meaningful and are going to determine the future of that sector. So I wanted to
Invite to the program Brenda Sharman. She is the owner of Cameo College of Essential Beauty, and she is a prior board chair for the Utah Board of Cosmetology. Ryan Claybaugh is the vice president of operations for Paul Mitchell Advanced Education. They are both based in Utah.
And Lynelle Lynch is the president and owner of Bellis Academy, and she is the founding president of Beauty Changes Lives, which is a wonderful organization that provides scholarships for people that are in the industry. So, Brenda, Lynelle, and Ryan, thank you for being with us. Thanks.
Brenda Sharman (01:41)
Thank you.
Lynelle Lynch (01:42)
Thank you.
Jason Altmire (01:43)
We'll start with Brenda. Talk a little bit about the cosmetology and beauty and wellness sectors concerns about the way accountability is measured, because I think few people would say, and I'll set the framework for what they're looking at. They're comparing people who have completed a higher education credential from certificate all the way up to doctorate, and they are comparing them.
to outcomes for people in other sectors and for people who have certificate level programs, they are being compared to folks who have only completed high school. And we'll talk a little bit about the flaws in that. But do you have a concern, Brenda, with just the theory, not necessarily the formula that they have put forward, but just the theory of someone who has completed a beauty and wellness
certificate, let's say cosmetology, being compared with their student outcomes and earnings post-graduation to somebody who only has a high school diploma.
Brenda Sharman (02:52)
Well, yes, Jason, and thanks for having us on today. We have grave concerns because when you hear the accountability metric, when you say a high school graduate, they're really not comparing our graduates to a high school only graduate. So when you take that metric that they are using, they're using age 25 to 34. So you're talking about individuals. Not only do they have a high school graduate, high school diploma, but they also do have or could have.
some post-secondary education. So we're talking about your HVAC contractors, welders, electricians, real estate agents. And I look at my own family as a perfect comparison. I have my daughter-in-law who has her business and she's raising our three grandchildren earning roughly 30 grand a year, but yet our son who is in the automotive industry making 120,000 a year. we've got
four or five of our children in the industry. And it's a perfect example of the comparison and the accountability measure that they're using. So my own family is actually, I hate to say it this way, but putting our sector out of business. And we service the women. We're primarily a 90 % female industry. And we just have, you know, 90 % female.
We are part-time workers working roughly 23 hours a week, raising children. So the comparison as far as the accountability, when you say a high school diploma or a high school graduate, who would have ever defined only a high school graduate as age 25 to 34? That's just a little surprising.
Jason Altmire (04:35)
I would add to the list that you put out, which is very accurate, looking at ⁓ real estate professionals and people in the skilled trades, perhaps a union welder, been on the job for 16 years at 34 years old, but also flight attendants. Often flight attendants only have a high school diploma, but are trained by the airlines. And then you can do very well in that profession, especially after 16 years in it. So I think you're making a very good point there.
Ryan, can you talk a little bit about the Paul Mitchell schools? I think people are familiar with the Paul Mitchell products and some may be familiar with the network of schools, but talk a little bit about who you're representing.
Ryan Claybaugh (05:18)
Some of the misnomer may be that since Paul Mitchell is on the building, these are a conglomerate of corporate schools owned by one large product company, which is Paul Mitchell, which is probably one of the largest hair care and well-known product companies in the world. Now, Paul Mitchell schools are actually franchises. And so we have about, I believe we have 94 franchise locations, and they're all run independently. You'd normally buy family groups. So they're all small businesses.
that are bought into the franchise. We have a lot of consistency in our practices, obviously, because that's under a franchise. But it also allows us to get data and information in good quantities. so many cosmetology schools are one program schools, and many bars are the same way. We may have additional programs like barbering and aesthetics, but at end of the day, they're all beauty-based programs. And again, that's how Palma Chia schools are laid out, or a franchise organization.
Jason Altmire (06:16)
How would you describe, I know with that many schools it varies, especially geographically, how would you describe the average student? How old are they? What's the gender and demographic look like?
Ryan Claybaugh (06:31)
Yeah, we pulled some data on this in the past and our average student is between the ages of 19 and 23. Over 90 % are female and most are, it's their first school right after high school. So it's their first post-secondary schooling experience. And it's something they've been, ⁓ it's been a dream their whole life to go to cosmetology school and to be a hairdresser. We just kind of look like we're fulfilling people's dreams and helping them get started on their career path.
Jason Altmire (06:59)
So it looks like they may settle on four years after program completion. If your average student is somewhere between 19 and 22, let's say 20, and the program is less than a year, so then she, four years out, would be 25 years old on average, could be give or take a year or two. And she's being compared to someone who's been in the workforce for 16 years.
certainly between the ages of 25 and 34. What is the difference in what a cosmetology graduate can make in over a 10 year period after she has left to make that an accurate comparison, comparing her to someone who's been out of high school for up to 16 years?
Ryan Claybaugh (07:50)
No, it's a great question. In our industry, takes a while to build your clientele. I read a statistic recently that over 50 % of beauty graduates end up working for themselves. And so that's a big number. And that doesn't happen a year after graduation. It doesn't happen two years after graduation. It usually happens six or seven years after graduation because you need to build that clientele. It takes time, as with any profession. You need to learn the intricacies of the business.
And I've seen studies that take six to seven years to fully build your clientele. Another reference I'll make as our graduates are 90 % female, many of our graduates, they start a family. choose, you they may have some children, they may be the caretaker. And so that will affect their decision to work full-time in the industry. And again, that's another reason why our industry is very popular is the flexibility of it all and the ability to work part-time and not be necessarily the breadwinner in your family.
but to be able to contribute to the overall household income. And you can do it on your own time, with your own schedule, so you can work around your caretaking and your mother responsibilities or whatever they may be. So it's very popular that way and it's very, very common.
Jason Altmire (09:04)
And the accountability rules do not account for that, does not account for part-time work. It assumes that the income every graduate has earned, it's their total income and it's compared based upon a full year, full time employment situation. And as Ryan and Brenda mentioned also, that is certainly not always the case, in fact, is usually not the case with graduates from this sector.
Lynelle, can you talk a little bit about, and I should mention also that you are the immediate past chair of Career Education Colleges and Universities, been on the board for many years and was chair for three years. So all three of you are very active and engaged nationally in the network of schools and the campaign to take action and do something to improve these regulations. Can you talk a little bit about Lynelle?
First, Bellis Academy, how many schools do you have and how long have you been doing that? But then what are the concerns that you have with regard to the accountability measure?
Lynelle Lynch (10:10)
Well, thank you, Jason, for having us on. This is a wonderful panel with my dear pair of friends. Bellis Academy, we have three locations in California and one in Kansas, Manhattan, of all places. And I am a little bit different from what Ryan said because the demographic in California is much older students coming. Yes, we have a good percentage of high school graduates, but 75 % of my students
have gone to college first because no one told them that this was a first choice. And that's hence why I started Beauty Changes Lives in 2012 was to try and elevate the perception of these careers. And like Ryan mentioned, so many of our students are female and choose this because of the extraordinary work-life balance. So also, as Brenda mentioned, I think we are very concerned about being compared to this ACS study that
has individuals who have graduated high school but could have certificates, could have an apprenticeship, so they could have had the same qualifications that our graduates have. And there are a number of industry studies on income as well as hours worked in our industry, which show that this is a part-time career. I remember in 2019, the International Spa Association came out with a study and said 50 % of the spa
executives work full time, but full time was 30 hours. So that just demonstrates that this is a part-time career. People are choosing it for the flexibility. They're choosing it to make a difference, to touch other people's lives. And so the accountability metrics, while I am thrilled if we can continue to have accountability for all sectors, we have fought regulations over the years, and that would be a huge win.
Coming up with a metric that recognizes the uniqueness of this industry is where I think we need to come forward with.
Jason Altmire (12:18)
Will you talk, Lynelle, I know you've been a leader, all three of you have been. I've heard Lynelle talk extensively about unreported income and the fact that the income that the government might see when it's looking at the students' response to a survey or even census data or any kind of income statement that they might submit does not include, in some cases, all the tips.
that they have received and they under report their income. Can you talk a little bit more about how that impacts this discussion, Leneil?
Lynelle Lynch (12:54)
think
it's tragic, but it is a reality. No matter how much financial literacy we put into our schools and help students understand they need to be counting their tips for credit scores, it's normally cash. And I remember years ago speaking with a congressman who said, yes, I pay for my service on my credit card, but I have to give them cash for the tip. I'm like, hello, don't you understand and recognize that that's because they're not reporting that? And the other more significant
issue now has been through COVID. All of these apps have come out, like Zelle and all these methods in which you can take money without having to go through a credit card terminal. And so there's a lot of even unreported services now based on these new apps. I know that in the big, beautiful bill, we received the no tax on tips up to $25,000.
which is going to be extraordinary for all the individuals that might have been claiming it over the years. But yes, there definitely is an issue. And the unfortunate side is there isn't a great data source today, whether it's the IRS, et cetera, that really understands that. There's been a report that came out that said that only 8 % was estimated to be tips, but we know that even
Those listeners, if you think about what you are tipping your professional, whether it's your massage therapist, esthetician, hairstylist, I think you probably give them a little bit more than that. It averages probably around 20%. So thank you for asking that. Yes, there's just that mystery of what is the reality in terms of the actual income in our profession. Because there's millions of people that have enjoyed this profession for years. And I don't think anyone out there wants to go
without a beautiful style from their hairstylist. We've seen tragic hair coloring, burning hair, or skin peels that have been bad. You need a licensed professional that understands anatomy, chemistry, et cetera. And I think our profession is very misunderstood because they think, it's just about cutting hair. It's all about chemistry and anatomy and science. So taking care of an individual is very scientific.
Jason Altmire (15:16)
That leads exactly to the next question I was going to mention, and that is, I have, like all of you, visited cosmetology schools all across the country, and I'm inspired by the students that are there, by their stories, and the fact that these are people that have a passion for the profession. And we're not measuring the income that they receive after.
they've left the program and how well financially they are doing that we've talked about that. But I think it's it's fair to say that many of these people are folks who potentially could have done something else, probably pursued a career where maybe they would make more money. But it's it's a profession of passion, something that they're good at. It's something that they want to do. And as Ryan said, have always wanted to do. It's been their dream to enter into this field.
And I think people do misunderstand the fact that you need to be certified to do it. States have different rules, but in every state you need to be certified for exactly the reasons that Lanell said. There is science associated with this. You can do some damage if you're not doing it the right way. You want to make sure that people have been well-trained. So I would ask Brenda, within that context, what do you see with regard to the students
that you serve and their expectation of their post-graduate success and what their careers might look like. How many of them, for example, intend to start a business at some point in their career?
Brenda Sharman (16:56)
Well, I'd like to add that we have a 97 % placement rate. And that placement rate is all over the board. So it is anywhere from working for chain salons to becoming independent. Some of them are self-employed right out of the gate, like Lanell talked about, that many of her graduates, this is a second source of education or career path because they do have degrees. And we also have had that. So we have several students, they come to us.
and their parents required them to get a degree in something, they got their degree, they still want cosmetology. So they circle back around now that they've satisfied their parents' requirements, now they're coming to cosmetology school. And they, just like you said, you just nailed it. They have a serious passion. When we ask, how long have you been thinking about becoming a cosmetologist or a nail technician or an esthetician? The answer, 100 % of the time, not 99.
100 % of the time is ever since I was a little girl and they're finally doing something that they want to do. They already know where they're going to go and what they're going to do. ⁓ Some of them, somebody mentioned, I think Ryan, that this is their first time. We recently had a nail graduate, it's a nine week program, 300 hours, standing on a stage, sobbing with her full support family saying, I am the first college graduate in my family. So they have,
They have a vision, they're very creative, they're very passionate. And if this proposed rule really does land and settle, this will take career choice away from tens of thousands of women that have a passion for this.
Jason Altmire (18:37)
And you mentioned your placement rate, Brenda. You don't have to mention specific employers unless you want to. But what are the types of jobs that students can get after finishing the program?
Brenda Sharman (18:48)
Well, we have several different programs in our campus. So we have nail technology, we have cosmetology, we have aesthetics, we have master aesthetics, we just barbering. So we offer anything that is in the beauty industry. And again, we open it up to anything. So we, to anything and everything, as long as it's legal. we have, we have your chain salons that will come in and share with our students what they have to offer.
Some of our graduates feel more comfortable going into a chain salon where there's basically a guaranteed wage, while others know that they want to be independent. They'll go into their own studio right off the bat. We have other individuals. We have a few individuals that have become manufacturers of products, of a lash line. So the industry is just very broad. It's a lot broader than what most people think about.
But again, anywhere from chain salons, whether it's a chain nail salon, chain beauty salon, aesthetic salon, or independent full service salons, the choice is really theirs to take. Whatever they're looking for, it's theirs.
Jason Altmire (19:59)
So the formula, as we've talked about, does not take into account part-time work, doesn't consider that some students may be under-reporting their income because they don't report their tips. The age comparison is way off, given the fact that oftentimes cosmetology and beauty and wellness graduates are younger being compared to people who are entering mid-career on the high school side. Lanell mentioned the fact that
there is a flaw in the survey that is used to determine the high school earnings of somebody who only has a diploma because it actually includes certificate holders on that side just because of the way the survey is. And also we didn't talk about gender inequity and when you're talking about a profession that has over 90 % women, that's going to be a factor also when you're comparing it to a more general population on the high school side.
So there are lot of flaws in the formula. There's a lot of work being done to get the Department of Education to consider modifying the formula that is used to compare high school graduates. So Ryan, I would ask you with your nationwide presence, the Paul Mitchell School Network is very, very politically active, has friends among the policymakers all across the country.
What are you doing through your schools to try to talk to policymakers about some of these issues and enforce some change at the Department of Education?
Ryan Claybaugh (21:36)
Like many industry groups out there right now, we've gone the path of hiring our own lobbyist in Washington, D.C. Some we've, we have done this in the past. And when I met with our franchise association, it's something that they supported and they wanted to move forward with bringing on. And so we are working obviously with a lobbyist. And in addition to that, we're gathering our own data. We're representative in, I believe, 36 different states. And so we are encouraging.
all of our schools and owners in those states to contact their representatives and explain the challenge with what this rule will do to the business. If you look at the US beauty and wellness industry as a whole, it employs 1.4 million licensed professionals. It's $130 billion industry. And so there's a lot on the line here. And it's not just schools that we're looking after. I know we're all from schools here, but I think the broader economic footprint here is where it
this rule could cut off the workforce opportunities for the entire beauty industry, which would be a detrimental economic impact to the US. So I think, you know, beauty services touch nearly every American that we see. And so again, our focus has been, obviously, we've discussed the flaws in the metric here, but our focus is also the economic impact that this could have on the industry as a whole in the United States. So again, I think everyone we know
touches beauty and wellness some point in their life. There's a recent study that came out that said even during inflation, visits to beauty and wellness salons went up. And so we've said in the past that haircuts or the beauty industry is inflation proof and recession proof because even in a recession or an inflation area, your hair keeps growing. You still gotta get your hair cut. Your hair doesn't stop growing in a recession. So it's something you gotta go to. we are a large organization, but we are a little bit.
Segmented, the Palmichel name does carry some great influence and does open some doors. But then the other day, I believe our schools are just like all the other small schools in the country. We're representing our students. We're just trying to find fairness in the rule.
Jason Altmire (23:47)
I would add in addition to being recession proof, it's also AI proof, which is really important in today's world. I think we're a very, very long way from robots carrying out that work. And I'm sure there's a lot of people, most people would not want that. They enjoy the personal interaction with their stylist. Lynelle, what do you consider in closing here to be the best possible outcome? Because we've pointed out what we see as some of the flaws
in the formula that's been proposed. But nobody disagrees that schools across all of higher education should be held accountable for their outcomes. You want to have programs that are allowing people to find work. And I think we've talked about the work that people are able to do from these programs. What do you think the best possible outcome is if some of these arguments are heard?
Lynelle Lynch (24:40)
That's
a very loaded question. I think there's many ways to approach this. As I had mentioned earlier, accountability for all is a beautiful thing, if we could land on that. But taking, again, all the things that we've shared today, part-time work, there needs to be an accountability metrics that works in the beauty sector so that we do know that quality education is being performed and that we can move forward. I know there's also a report out there that says,
in the Texas area that only 15 % of schools are quote accredited. And we've kind of debunked that with our curriculum providers that say 83 % of what they issue books for go to accredited schools. So the number of students is a little bit different there. So there's a variety of opportunities. I think because the gainful employment lawsuit is still there and this accountability under the one big beautiful bill was supposed to be just for
bachelor, doctor degree programs and not including certificates. I think there still is a strategy there. That's for the legal experts to kind of define if we go one route versus another. But I think in a dream world, it would be to come up with an accountability metrics that would work for the beauty industry that would allow our students to have access to this incredible career. And you asked Brenda earlier, what do our students aspire to be?
Well, again, I created Beauty Changes Lives because I have met extraordinary icons in our industry that have created incredible companies like Paul Mitchell, like it's a 10, Carolyn Aronson, who's made her millions because she chose this industry. She chose to get a license. So I think those that are interested in this industry, I always say dream as big as you want, because yes, you can stand behind the chair, you can work in a spa.
You could own your own company. You could start a salon. You could become a platform artist. I could go on for hours with all the careers that a license allows you to perform. But again, going back to your question, I would almost throw it back to you and say, what do you think the right outcome for this would be and how do you see us continuing to preserve this industry?
Jason Altmire (26:59)
I do know that if you correct the formula for these issues, you correct for the idea of part-time work, you don't consider part-time income to be full-time employment. If you correct for the apples to apples comparison on age, if you do consider gender inequity and the fact that women are underpaid. Another profession that is greatly impacted by this are medical assistants, which is also
a female dominated profession. So it's disproportionately impacted by any sort of gender inequity in pay. Obviously, we talked about the flaw in the survey that's used and unreported income if there's some accommodation made. We're not asking for special treatment. You just make the formula fair that it accounts for all of these issues. Then it is a much better outcome with regard to schools, at least in this sector.
There are other areas of higher education that may not do as well, but as it relates to the beauty and wellness sector, it's not going to save everybody. I you have to be a high quality school with good outcomes and a long track record of success, but it is going to at least take a more fair look. Let's close with Brenda sort of with offer, you would, Brenda, the closing argument for the layman that's out there, not the policymaker. We've kind of.
geared this discussion towards people assuming knowledge that they understand the deal, but how would you describe just to the average person out there listening, what the impact would be if cosmetology was affected in this way? And how would you describe the situation as it currently stands and where you think we need to go?
Brenda Sharman (28:48)
Well, I think the impact for young females would be absolutely devastating. It would be a very sad place because these individuals, like we said earlier, have been wanting to do this. They're creative. They've had a passion since they were a little girl. It would eliminate school choice and push them to a sector that they don't have an interest in, that they don't have a passion in. I think of parents saying, you can't get funding for this. You can't get any type of financial help.
let's look at another industry. So I think that it would deplete our industry. And I think that it would take away the school choice for so many individuals that really have a passion. So when I look forward to this industry, I think that it would definitely not look like it does today because we are very much a growing industry. We are an exciting industry. We love what we do and we can go all different angles.
And I think that that would really be devastating to take away that school choice.
Jason Altmire (29:52)
That is Brenda Sharman. She is the owner of the Cameo College of Essential Beauty based in Salt Lake City, outstanding beauty and wellness school. Ryan Claybaugh has also joined us. He's vice president of operations at Paul Mitchell Advanced Education and Lanell Lynch, president and owner of Bellis Academy and founder and president of Beauty Changes Lives. I would encourage people to Google.
Beauty Changes Lives. It's a great organization and learn how you can become involved in supporting students that want to go into these professions. All three of you, thank you so much for being with us.
Ryan Claybaugh (30:29)
Thanks for having me.
Brenda Sharman (30:30)
Thank you. Thank you.
Jason Altmire (30:36)
Thanks for joining me for this episode of the Career Education Report. Subscribe and rate us on Apple Podcasts, Google Play, Spotify, or wherever you listen to podcasts. For more information, visit our website at career.org and follow us on Twitter @CECUED. That's at C-E-C-U-E-D. Thank you for listening.
Lynelle Lynch (31:09)
it.