Career College Students Come From Less Affluent Backgrounds

by Daniel L. Bennett

A few weeks ago, I wrote a blog defending career colleges from criticism that their students take on larger average debt loads than students in other sectors. The basis of my argument was

that career college students, on average, come from lower income families than students at public and private not-for-profit schools and would need to borrow more money, on average, than more affluent students, regardless of the type of school they attend.

At the time of the posting, I stated that "I don't have comprehensive comparable data in front of me for the public and private not-for-profit sectors, the evidence that I have seen is that these sectors serve a significantly lower proportion of low income and minority students who are less likely to need student loans to pay for college than does the for-profit sector. This suggests that students at public and private not-for-profit schools are more likely to have at least some help from their parents or other private sources to help pay for college."

In collecting Pell Grant data from DAS, I came across data which supports this statement. The below table shows the percentage of students receiving a Pell Grant and the average grant amount for recipients, by institutional sector and control. At 4-year for-profit schools, 57.5% of students received a Pell Grant in 2007-08, whereas only 25.4% of 4-year public and 25.7% of 4-year private not-for-profit students received a Pell Grant. At 2-year institutions, 71.7% of students at for-profit schools received a Pell Grant in 2007-08, whereas 21.2% of public and 39.2% of private not-for-profit students received a Pell Grant. At less than 2-year institutions, 65.6% of students at for-profit schools received a Pell Grant in 2007-08, whereas 34% of public and 61.9% of private not-for-profit students received a Pell Grant. Because the Pell Grant is a financial need-based award, these data confirm that students at career colleges are much more likely to be from less affluent backgrounds, explaining why they would, on average, take on greater student debt loans than students at public and not-for-profit schools.