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Fifteen years doesn’t seem like a distance too expansive for the memory to recall, but do you remember what you were doing in 2002?
Career education leaders who were involved in the sector at that time remember a world of higher education far different than recent years. In 2002, the career education sector was exploding with growth. Online education was completely changing the landscape of higher education. While traditional colleges and universities were slow to fully embrace the trend, career and technical schools were blazing new paths with the technology's capabilities.
The online learning craze was perfect for career college students, who often work a job or two (or more) while supporting a family and taking full course loads. Career schools developed innovative new online programs that complemented already flexible course schedules, allowing students to learn at their pace, on their own time, often from their own homes.
The “early 2000s” provided, in many people’s minds, the ultimate atmosphere for schools to thrive and students to gain access to the education that could help them attain careers that would turn their lives around.
But with different presidential administrations and political parties being elected to the highest office come different views of what higher education should be and how colleges should operate for the benefit of students. New administrations bring differing takes on how stringent government should be with regulatory oversight. The way history has played out over the last few presidencies has many wondering if the Department of Education under President Donald Trump will return higher education — specifically the career education sector — back to the days where schools were growing at unprecedented rates.
Business-friendly stances
The substantial growth of career colleges lasted throughout the presidential administration of George W. Bush, who (in being consistent with the platforms of Republican presidents) for the most part took business-friendly stances that allowed many sectors to thrive. The changes eventually brought about by former President Bush reach back to 1992, when a law was passed prohibiting schools from paying bonuses, commissions or other financial incentives based — either directly or indirectly — on the success of recruiters and loan officers to secure enrollments and financial aid. At that time, the law was drafted to respond to concerns from Congress that some career colleges were recruiting students merely to secure federal loans, not because the students were qualified to pursue higher education.
About 10 years later, the Bush administration made two adjustments to the rules. The first involved the "safe-harbor" regulation, which set out 12 circumstances where schools could adjust recruiters' payments and not violate the incentive compensation ban. Secondly, the administration issued an internal guidance that indicated recruitment rule violators would be subjected to fines, and yet they would not be prevented access to federal financial aid.
The Bush-era environment of growth for career colleges eventually withered under the presidential administration of Barack Obama. The Obama administration found that many schools, including some traditional colleges and universities, had used aggressive marketing to recruit students and didn’t follow through on delivering quality education.
Most career educators don’t need a refresher on the gainful employment rule instituted by the Obama-era Department of Education. The rule, which cuts off loans to colleges if their graduates don’t earn enough money to pay off their student debt, eventually caused many schools to close their doors, including some prominent and iconic brand names in career education.
Adding fuel to the fire
Now, after the gainful employment rule has taken its toll on career colleges, what’s next under the Trump administration? Some who look back at history could conclude that a return to a friendlier atmosphere for growth could be on the way with Trump. A businessfriendly entrepreneur who himself operated a university — and appointed Betsy DeVos as secretary of education to bring out massive changes to our education system — Trump could institute regulatory changes that create a much different environment for career colleges than the last half-decade.
Recently, more fuel has been added to this speculation fire. The Trump administration is formally reconsidering two Obama-era rules. In mid-June, the Department of Education froze changes that would speed up and expand a system for erasing the federal loan debt of student borrowers who were cheated by colleges that acted fraudulently. It also throws into limbo what is known as the gainful employment mandate, which cuts off loans to colleges if their graduates don’t earn enough money to pay off their student debt. What will happen under President Trump remains a guessing game for now, but the sector's past does in fact show that changes could be in store for a sector that has spent the last few years languishing.
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