Title: PostSecondary Education Student Debt: Reality and Perception in the Canadian Career College Sector
1Post-Secondary Education Student Debt Reality
and Perception in the Canadian Career College
Sector
25th National Student Financial Assistance
Research Network Conference - Baltimore
Leesha Lin, Canada Student Loans Program Human
Resources and Social Development Canada
June 14,2008
2Our plan to fill knowledge gap for private,
for-profit sector started in 2006
- Statistics Canada does not collect data for
Canadas private, for-profit sector - Canada Student Loans Program and Canada
Millennium Scholarship Foundation commissioned a
survey of this sector in 2006 - Stage 1
- Research for a list of private, for-profit
schools (2,423). Review the list to include only
eligible higher education schools excludes
targeted second language schools or
correspondence programs or mainly government
funded programs. - Survey forms were sent to 1,622 private,
for-profit schools - Based on form responses and further contacts, 384
schools were eligible and agreed for in-class
survey - Stage 2 In-class student survey Sep. 2006 to
Feb. 2007 - Stage 3 Follow-up survey of graduate of the
in-school cohort (61) - Stage 4 Explore possibility for future
follow-up surveys
3Results from Stages 1 2 of our Research,
combined with analysis of Student loans
administrative data for public v. private sectors
- This sector is more comparable to public
community college programs. - Results of this survey are compared with the
results from - the 2006 Canadian Colleges Student Finances
Survey covering students attended community
colleges and - 2003-04 Investing in Your Future, university
and community college survey. - In addition, we compare some student loans
take-up, repayment capacity for the public versus
private schools, based on the administrative data
files.
4Demographics of student population - Gender
- Students attending private, for-profit colleges
tend to be female (72 compared to 69 for
community colleges, 58 for university).
5Demographics of student population - age
- Students attending private, for-profit colleges
are older, with 48 of students aged 25 years
older. - In the public college system, 31 of students are
25 years older
6Demographics of student population with
dependants
- Students attending a private, for-profit college
are more likely to support a child or children
under the age of 18 years. 33 of them support a
child as compared to only 17 of the students in
the public PSE system.
7Demographics of student population Low-Income
groups
- Some disadvantage groups were disproportionately
represented among the low income group single
parents and Aboriginals.
8Demographics of student population Living
arrangements comparison
- 46 of public university or college students live
with parents, 17 live with a spouse or partner. - 19 of private career college students live
alone, as opposed to 13 for public university or
college students.
9Demographics of student population Prior PSE
- Prior to entering the private post-secondary
education system, (35) students had completed a
post-secondary diploma or degree. - 45 of public college students had completed a
post-secondary diploma/degree prior to entering
the public college system.
10Demographics of student population Parental
Education
- Predictors of Post Secondary Education (PSE)
Participation - 41 of parents of students attending a private
career college had no PSE compared to 27 of
parents of students attending a public college,
and 20 of parents of students attending a
university.
11Demographics of student population
- Barriers to not entering PSE immediately after
high school
12Private, for-profit programming
- Program enrollment length
- 69 survey enrolled in program of one year or
under
13Private, for-profit programming
- Most Common programming private sector
- students most commonly take programming related
to Health (38) and Media or Information
Technology (24).
14Private, for-profit programming main reason to
enrol - retraining
- Reasons for Enrollment private for profit
schools - Students in private career colleges enroll in
post-secondary education for a wide range of
reasons, with a change in career or to pursue a
specific career (36) being the most frequently
cited reason
15Private, for-profit programming total tuition
to complete a program
- 52 of students attended a private, for profit
college paid over 10K for tuition. Average
tuition is 14,364
Includes student loan borrowers only.
16Private, for-profit programming Financing
- 53 of students use loan to cover cost of their
program
17Private, for-profit programming Financing
- community college students have greater resources
from family (59 v. 26), personal savings (47
v. 19), current employment (70 v. 8)
18Private, for-profit programming Financing
- 53 of students had student loans, which cover
44 of cost
19Private, for-profit programming Perception on
Debt Repayment
- 42 of students that anticipate having student
loan debt at the end of their program, the
majority (54) anticipate it will take seven
years or less to repay the debt.
20In-Study Interest Subsidy borrowers by
institution type
- Borrowers attended private, for profit schools
are more likely to study for short program, with
an average in-study of 1.8 years (2.5 years for
public colleges, 3.1 years for universities.)
21Repayment Capacity by Institution Type
- Borrowers who attended private, for profit
schools are more likely to default on their loans
(33 v. 23 - public colleges, 13 -
universities).
22Use of Repayment Assistance - No interest, no
payment (IR)
- Borrowers who attended private, for profit
schools were less likely to use interest relief
(IR) assistance, but stayed in IR longer
23Private, for-profit Sector summary (1)
1
- The preliminary findings for this sector include
- Students are more likely to be older (median age
29 v. 26 public college) - They are more likely to be female
- They are more likely to have dependants (37 had,
avg. 1.84) - Main reasons for attending are to change career,
improve skills - The other reason is the length of program (69
are 1 yr or less in length)
24Private, for-profit Sector summary (2)
1
- They are less likely to draw upon funds generated
from working while in school (8 vs. 70). - They are less likely to receive supports from
parents/family (26 v. 59 from community
colleges) - They are less likely to have savings from
previous employment (19 V. 47 from community
colleges) - They are more likely to rely on government
student loans (53 v. 29 from community
colleges). - They are less likely to have non-repayable
assistance from schools (5 v. 25 from community
colleges)
25Private, for-profit Sector summary (3))
1
- For those who had student loans, they are more
likely to default on their student loans (33 v.
23 for community college or 13 for university
students). - One of the reasons is that they are less likely
to use repayment assistance (17.6 v. 19 for
community college or 21.5 for university). - The other reason is probably due to their earning
after graduation This will need to be confirmed
from the Stage 3 report.
26Private, for-profit Sector Next Steps
- Stages 3 and 4 of survey results of graduate
follow-ups - Monitor the Impact of new initiatives (to be
effective August 1, 2009, if passes) on students
attending private, for profit colleges - New grants for students from low- and middle-
income families - Improved grants for students with dependants
- Repayment Assistance Program (RAP) provides the
following guarantees - under RAP monthly payments will be at
"affordable" levels and borrowers with very low
income are not required to make any payment - no loan for which the borrower makes the required
payments will be repayable beyond 15 years after
full-time studies. - under the proposed RAP model the maximum monthly
payment for any borrower will be up to 20 of
gross monthly income.
27Private, for-profit Sector Contact Info
- Contact Information
- Leesha Lin, CMA, M.A.
- Acting Director, Operational Policy and Research
Division - CSLP Directorate
- Human Resources and Social Development Canada
- 200 Montcalm, Tower 2, 1st Floor
- Gatineau, Quebec K1A 0J9
- Tel (819)994-4518 Fax (819)953-6661
- Email leesha.lin_at_hrsdc-rhdsc.gc.ca
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