Academic journal article Journal of Teacher Education

The Growth of For-Profit Higher Education

Academic journal article Journal of Teacher Education

The Growth of For-Profit Higher Education

Article excerpt


In the past several years, increased interest in for-profit education accompanied by the availability of venture capital has focused discussion and debate on this growing segment of American education. Earlier for-profit companies' involvement in education targeted ancillary and support services whereas the new entrants into the market focus on education's core, the curriculum. Supporters of for-profit education point to the benefits that accrue from competition in a free market scenario, most importantly, the improvement of education and potential reduction in costs. Educators argue that public schools and universities play a critical role in a democratic society by providing education for citizenship and access to opportunity--functions not often addressed by for-profit firms. At the higher education level, for-profit universities are beginning to offer teacher education programs specifically designed to meet state requirements only.

This article examines the recent growth of for-profit, degree-granting higher education in the United States with a special focus on for-profit teacher education. The article concludes with a discussion of the implications of these developments for traditional colleges and universities.


From their modest beginnings during the colonial period, proprietary (for-profit) schools in the United States have had a vocational orientation (Honick, 1995). Significant growth in this sector occurred after World War II when the GI Bill funded returning veterans' attendance at postsecondary schools, including the for-profit schools. In the 1970s and 1980s, proprietary schools became eligible to receive state and federal student financial aid. This receipt of significant federal subsidies allowed the for-profit schools to shift their environment from purely market driven to partially federally subsidized (Clowes, 1995; Hawthorne, 1995).

Today these schools, sometimes referred to as career colleges, are major providers of entry-level skill training beyond the secondary school level. They offer occupationally oriented certificates and even associate's and bachelor's degrees. By the late 1980s, there were approximately 4,000 accredited proprietary institutions enrolling an estimated 1,800,000 students (Lee & Merisotis, 1991).

The emergence of for-profit, degree-granting, accredited institutions of higher education is now a topic of keen interest to higher educators. It has the potential of providing real competition and altering some segments of nonprofit higher education. Strosnider (1998) observed that within a very short timeline of about 5 years, postsecondary proprietary education transformed itself from a small sector of the economy mainly offering specialized trade training to a $3.5 billion a year business that is dominated by companies building regional and national franchises. Among the major players is the Apollo Group (, which offers certificate programs as well as associate's, bachelor's, master's, and doctoral degrees through its subsidiaries; the University of Phoenix, Inc. (UOP); the Institute for Professional Development; the College of Financial Planning Institutes Corporation; Western International University, Inc.; and Apollo Learning Group, Inc. Currently, Apollo offers educational programs and services at 55 campuses and 98 learning centers in 35 states, Puerto Rico, and Vancouver, Canada. Its combined degree enrollment is approximately 104,000 students (Wyatt, 2000). DeVry ( specializes in business and technical education and has more than 40,000 students in business and technology at sites in the United States and Canada. ITT Educational Services ( operates more than 70 technical institutes, enrolling more than 25,000 students seeking associate's and bachelor's degrees in technology fields.

What Has Fueled the Growth? …

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