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Gainfully Employed?: Assessing the Employment and Earnings of For-Profit College Students Using Administrative Data

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  • Stephanie Riegg Cellini
  • Nicholas Turner

Abstract

We draw on population-level administrative data from the U.S. Department of Education and the Internal Revenue Service to quantify the impact of for-profit college attendance on the employment and earnings of more than one million students. Using a matched comparison group difference-in-differences design, we find that certificate-seeking students in for-profit institutions are 1.5 percentage points less likely to be employed and, conditional on employment, have 11 percent lower earnings after attendance than students in public institutions. These results hold for both men and women and for seven of the top ten fields of study. We find that earnings and employment outcomes are particularly poor for students attending for-profit colleges that offer the majority of their courses online and for multicampus chains. We find that for-profit students experience small, statistically insignificant gains in annual earnings after attendance compared to a matched control group of young individuals who do not attend college. A back-of-the-envelope comparison of these earnings gains to average debt burdens suggests that for-profit certificate programs do not pay off for the average student.

Suggested Citation

  • Stephanie Riegg Cellini & Nicholas Turner, 2019. "Gainfully Employed?: Assessing the Employment and Earnings of For-Profit College Students Using Administrative Data," Journal of Human Resources, University of Wisconsin Press, vol. 54(2), pages 342-370.
  • Handle: RePEc:uwp:jhriss:v:54:y:2019:i:2:p:342-370
    Note: DOI: 10.3368/jhr.54.2.1016.8302R1
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    References listed on IDEAS

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    1. Darolia, Rajeev, 2013. "Integrity versus access? The effect of federal financial aid availability on postsecondary enrollment," Journal of Public Economics, Elsevier, vol. 106(C), pages 101-114.
    2. Rajeev Darolia & Cory Koedel & Paco Martorell & Katie Wilson & Francisco Perez‐Arce, 2015. "Do Employers Prefer Workers Who Attend For‐Profit Colleges? Evidence from a Field Experiment," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 34(4), pages 881-903, September.
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    4. David J. Deming & Claudia Goldin & Lawrence F. Katz, 2012. "The For-Profit Postsecondary School Sector: Nimble Critters or Agile Predators?," Journal of Economic Perspectives, American Economic Association, vol. 26(1), pages 139-164, Winter.
    5. Ann Huff Stevens & Michal Kurlaender & Michel Grosz, 2015. "Career Technical Education and Labor Market Outcomes: Evidence from California Community Colleges," NBER Working Papers 21137, National Bureau of Economic Research, Inc.
    6. Christopher Jepsen & Kenneth Troske & Paul Coomes, 2014. "The Labor-Market Returns to Community College Degrees, Diplomas, and Certificates," Journal of Labor Economics, University of Chicago Press, vol. 32(1), pages 95-121.
    7. Jacobson, Louis & LaLonde, Robert & G. Sullivan, Daniel, 2005. "Estimating the returns to community college schooling for displaced workers," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 271-304.
    8. Lang, Kevin & Weinstein, Russell, 2013. "The wage effects of not-for-profit and for-profit certifications: Better data, somewhat different results," Labour Economics, Elsevier, vol. 24(C), pages 230-243.
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    11. Stephanie Riegg Cellini & Claudia Goldin, 2014. "Does Federal Student Aid Raise Tuition? New Evidence on For-Profit Colleges," American Economic Journal: Economic Policy, American Economic Association, vol. 6(4), pages 174-206, November.
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    14. Stephanie Riegg Cellini, 2009. "Crowded Colleges and College Crowd-Out: The Impact of Public Subsidies on the Two-Year College Market," American Economic Journal: Economic Policy, American Economic Association, vol. 1(2), pages 1-30, August.
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    Citations

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    Cited by:

    1. Jepsen, Christopher & Mueser, Peter R. & Jeon, Kyung-Seong, 2016. "The Benefits of Alternatives to Conventional College: Labor-Market Returns to Proprietary Schooling," IZA Discussion Papers 10007, Institute of Labor Economics (IZA).
    2. Stephanie R. Cellini & Rajeev Darolia & Lesley J. Turner, 2016. "Where Do Students Go when For-Profit Colleges Lose Federal Aid?," NBER Working Papers 22967, National Bureau of Economic Research, Inc.
    3. Sarena Goodman & Adam Isen & Constantine Yannelis, 2018. "A Day Late and a Dollar Short : Liquidity and Household Formation among Student Borrowers," Finance and Economics Discussion Series 2018-025, Board of Governors of the Federal Reserve System (US).
    4. Robert G. Valletta, 2018. "Recent Flattening in the Higher Education Wage Premium: Polarization, Skill Downgrading, or Both?," NBER Chapters,in: Education, Skills, and Technical Change: Implications for Future U.S. GDP Growth, pages 313-342 National Bureau of Economic Research, Inc.
    5. Armona, Luis & Chakrabarti, Rajashri & Lovenheim, Michael, 2017. "How does for-profit college attendance affect student loans, defaults, and labor market outcomes?," Staff Reports 811, Federal Reserve Bank of New York, revised 01 Sep 2018.
    6. Petri Böckerman & Mika Haapanen & Christopher Jepsen, 2018. "Labor-Market Returns to Higher Vocational Schooling," CESifo Working Paper Series 7197, CESifo Group Munich.
    7. Benjamin Castleman & Joshua Goodman, 2018. "Intensive College Counseling and the Enrollment and Persistence of Low-Income Students," Education Finance and Policy, MIT Press, vol. 13(1), pages 19-41, Winter.
    8. repec:spr:reihed:v:59:y:2018:i:7:d:10.1007_s11162-017-9491-x is not listed on IDEAS

    More about this item

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • I20 - Health, Education, and Welfare - - Education - - - General
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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