The risk stems from students taking on massive amounts of debt without a guarantee of obtaining skills for employment, according to the report. Even though the U.S. issues $150 billion in student aid, student debt continues to rise to historic levels and adequate jobs to repay that debt have stagnated. The report says the system’s problems stem from decentralized standards on quality and cost, which is left up to accreditation agencies, the institutions, and state governments.
The authors also point out that developing countries take a more involved approach by providing higher subsidies to working families. Meanwhile, the cost of college in the U.S. has been rising significantly.
The report’s main focus is on technical schools, community colleges, and institutions that grant career-specific certificates and associate’s degrees. Students may have a confusing array of options for obtaining credentials from certificates that can overlap and compete. One way to fix this problem, according to the report, is to integrate more businesses into the picture, such as a national apprentice program like one in Scotland that integrates job experience and course work.
Community colleges and technical schools, which tend to be for-profits, have been scrutinized as a waste of money that lead to more loan defaults than graduates. Furthermore, for-profits have used taxpayer money to recruit students, who are often low income and need economic mobility the most.
The good news is that plans are emerging in the Oregon legislature and from U.S. Senate candidate and Newark mayor Cory Booker to give the government, both state and federal, a bigger role in funding students’ higher education costs. If realized, the plans would likely include stricter regulations to ensure the money goes to good use.