The Labor Market Returns to For-Profit Higher Education - Evidence for Transfer Students - Abstract

Oct 15, 2026

Uploaded by kopisore

This study analyzes labor market gains for students who begin at community colleges and later enroll in for-profit colleges. Using student-level administrative records, unemployment insurance earnings, and National Student Clearinghouse progression data for community college cohorts from 2001 to 2006, the analysis applies regression and fixed-effects models to estimate wage gains across transfer patterns. Results show significant wage penalties for transferring into for-profit institutions versus public or nonprofit options, and for some groups higher earnings when dropping out rather than transferring. Findings indicate lower opportunity costs during enrollment but insufficient compensation for weaker post-college earnings growth.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages23

Reading Time58 min

AccessFree to download

Abstract

Objective

Method

Results

Conclusion

Background and Motivation

Transfer interest and equity goals

For-profit sector context

Institutional differences and policy considerations

The Labor Market Returns to For-Profit Higher Education: Evidence for Transfer Students Vivian Yuen Ting Liu 1 and Clive Belfield2 Community College Review 2020, Vol. 48(2) 133–155 © The Author(s) 2019 Article reuse guidelines: [sagepub.com/journals-permissions](sagepub.com/journals-permissions)[ ](sagepub.com/journals-permissions)[DOI: 10.1177/0091552119886659](DOI: 10.1177/0091552119886659)[ ](DOI: 10.1177/0091552119886659)[journals.sagepub.com/home/crw](journals.sagepub.com/home/crw) Abstract Objective: This study examines the labor market gains for students who enrolled at for-profit colleges after beginning their postsecondary education in community college. Method: We use student-level administrative record data from college transcripts, unemployment insurance earnings data, and progression data from the National Student Clearinghouse across full entry cohorts of community college students in two statewide systems between 2001 and 2006. Using regression analysis and fixed effect methods, we calculate the wage gains to attainment across different student transfer patterns. Results: We find significant wage penalties to transfer to a for-profit college instead of to a public or private nonprofit college. For some student groups, earnings are higher if they drop out of community college instead of transferring to a forprofit college. Conclusion: Students in for-profit colleges do have lower opportunity costs in terms of foregone earnings while enrolled in college. However, these do not sufficiently compensate for lower earnings growth after college. Keywords community college, college transfer, for-profit colleges, returns to college Transfer from community colleges to 4-year institutions has long been of interest to researchers, educators, and policy makers. As more than half of all low-income students begin their postsecondary education at 2-year institutions, by promoting transfer, these colleges may play a critical role in promoting upward economic mobility for 1 Columbia University, New York, NY, USA 2The City University of New York, Flushing, USA Corresponding Author: Vivian Yuen Ting Liu, Community College Research Center, Teachers College, Columbia University, Box 174, 525 West 120th St., New York, NY 10027, USA. [Email: Ytl2102@columbia.edu](Email: Ytl2102@columbia.edu) underserved students (Berkner & Choy, 2008) . However, research shows that attending a community college and then transferring does not necessarily increase bachelor’s degree attainment rates and earnings. It is unclear whether baccalaureate-seeking students should be encouraged to go straight to a 4-year college or to attend community college and then transfer. It is likely that the effect of transferring depends on the typeof college to which a student transfers. Little is known about how transfer varies across different sectors of destination institutions. One transfer option for community college students is the for-profit sector. Using the Integrated Postsecondary Education Data System (IPEDS), Figure 1 provides context. It shows that the for-profit share of enrollments is 8%(having been as high as 12% in 2010). The for-profit share of transfer-in students (students laterally or vertically transferring in from another college) is 12%(with a peak of 16% in 2011) . Thus, within the context of an increasing transfer enrollment total (at almost 1 million students, up from 400,000 in 2006), for-profit colleges are disproportionately recruiting transfer students. The for-profit sector offers a college experience that differs significantly from that in the public and not-for-profit sectors. Relative to other colleges, for-profit colleges operate with a different organizational structure with respect to faculty hiring and pay, curricula, and student supports, as well as with a different set of financial constraints (Breneman, 2008) . Also, for-profit colleges typically serve nontraditional students, including working

FAQs

What is the study’s main objective?

The study examines labor market gains for students who enrolled at for-profit colleges after starting postsecondary education in community college.

What data and methods are used?

The study uses student-level administrative record data, unemployment insurance earnings data, and National Student Clearinghouse progression data, analyzing wage gains using regression analysis and fixed effect methods.

What are the key results about wages after transfer?

Transferring to a for-profit college instead of a public or private nonprofit college is associated with significant wage penalties, and for some student groups earnings are higher when dropping out rather than transferring to a for-profit college.

Oct 15, 2026

Uploaded by kopisore