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Struggling University of Phoenix Lays Off 900
An anonymous reader writes: The struggles facing for-profit colleges continue. The University of Phoenix announced poor quarterly earnings yesterday, and the institution has laid off 900 workers since September. Enrollment is down 14% since last year, and the CEO of its parent company, Apollo Education Group, says enrollment is likely to drop from 206,000 to about 150,000 next year. Apollo's stock has lost more than half its value since the beginning of the year. "Tighter regulations on for-profits and the Obama administration's push to make community college free top the list of headwinds. And non-profit universities have entered the online education space, where for-profit schools once held center stage."
Low profit? Double the tuition! It is not like guaranteed student loans provided to student will turn it down.
This is how we got into this mess - guaranteed loans and inability to discard them in bankruptcy removed all competitive pressures on price.
>> Obama administration's push to make community college free top the list of headwinds
I lean conservative, but I call BS here. Obama's push was dead on arrival and largely forgotten.
>> And non-profit universities have entered the online education space, where for-profit schools once held center stage.
I'm not even sure I believe this. To save money and graduate faster, I picked up many of my 100's and 200's via "telecourses" I purchased through my local community college...and that was in the early 1990s.
Agree. Any employer who sees the name "University of Phoenix," or "Devry," or "ITT" etc. on a resume is going to throw that shit right in the trash.
The struggles facing for-profit colleges continue. The University of Phoenix announced poor quarterly earnings yesterday
Cry me a river. These are companies that prey on people who are financially unsophisticated and often have no business being in college. (No disrespect intended but not everyone is college material or is ready for it even if they are) They push huge amounts of debt on people ill prepared to deal with it and provide a shoddy facsimile of an education. No employer is impressed by a degree from these degree factories because they know the "schools" are third rate at best.
To be fair, most employers are also third rate at best and will end up staffed with third-rate employees because first-grade ones require first-grade pay and job. It's the pathological refusal to admit mediocrity is okay that causes the whole student debt crisis, since companies dream of being the next Google without any intent to invest anything towards that. It also leads to a cynical workforce that ignores even sensible corporate policies due to having witnessed megalomania and utter disconnect from reality too often.
Work all too often resembles an absurd farce where everyone lies, everyone knows everyone lies, everyone knows that everyone knows that everyone lies, and so on (my personal pet peeve is "zero incidence culture", where no incident is acceptable, thus people wait until work is finished before going to see a doctor if they get hurt to avoid getting punished for costing management their safety bonuses, leading to more sick days and sometimes mortal danger). They go through the motions anyway, since it's a kind of ritual meant to give something that theoretically exists only as legal fiction a palpable presence. The problem is, that presence is all too often heavy and oppressive, a kind of vampire sucking life out of its victims to sustain its own.
Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
Have you actually priced these guys? My ex-wife used them back in 2001-2003 to finish up a BSN degree, and paid an obscene amount of cash each month to do it. They also adopted that neat little trick the state colleges have of requiring 'bridge classes' and of discounting certain courses taken (in favor of pricier ones they provide), so sometimes you're taking superfluous classes and in some cases re-taking classes you'd already taken.
One thing I do wonder about though... most of the oft-touted 'free' community college courses are more towards getting an Associates' degree, whereas Phoenix' big advertising push is for folks who want to convert their 2-year degree into a 4-year one, or to convert a Bachelors' into a Masters'.
Personally, I think their biggest competition is the recent growth of small state-accredited colleges going online, expanding their presence, and pushing to provide the same thing Phoenix does. Many of these colleges have provided this sort of thing remotely (albeit not online, but by 'traveling prof') to military members for decades, but have recently decided to get a piece of the civilian market now.
The thing is, what matters isn't the final bill. What matters, in recent years, has been the apparent short-term affordability of such institutions.
Two things have been happening in higher education in the last 15 years. One, a recession drove many people out of the work force, and a lot of those people instead turned to higher education while they were idling as a way to improve their marketability and also kind of hit the 'pause' button on working until things improved. And two, most of those people did it by taking on student debt. For-profit schools flourished during this time, because they understood that the name of the game to growing their enrollments was at least as much about how to finance the education as it was about the nature of the education itself.
But now, two other things are happening that counteract each of those effects. One, the job market is growing steadily, and even more importantly, people are returning to the work force. That's how it's possible for more and more net job creation to take place, and yet for unemployment (the number of people *looking for work* who are unemployed) to rise at the same time. And two, everyone has suddenly caught on to the fact that people are racking up massive amounts of debt to finance these classes, without really gaining all that much in the way of job opportunity. So the drive towards education using this model fades, and a counterforce starts pushing away from it.
Really, this was inevitable...it's almost like there was a "higher education bubble" that is bursting as we watch. Instead of it being funded by subprime mortgages and shady income verification, it has been funded by aggressive student loan processes and overstated promises by many institutions.
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