Measuring Up: How BLS Data Would Inflate Earnings for Career Training Graduates

Source: Ben Barrett and Sophie Nguyen, New American Foundation, February 2018

From the summary:
On January 29, the U.S. Department of Education released a blueprint for how it plans to revise the gainful employment (GE) regulations, which the Obama administration put in place in 2014. Most notably, the Department’s proposed rule would eliminate all sanctions for career-oriented programs that leave students with large debt but without the training to land a well-paying job after graduation. Preserving only a modified version of the current disclosure requirements, the regulations could be further weakened if for-profit colleges get their way during the second round of negotiations. Instead of disclosing or holding career-oriented college programs accountable for the amount of debt that graduates borrow relative to the amount they earn a few years after completing, as the current rules do, for-profit college leaders and lobbyists have called for substituting actual students’ earnings with local estimates derived from the Bureau of Labor Statistics (BLS). While the Department’s proposal to strike any consequence from the GE regulations may seem brazen in comparison, attempting to use BLS data in place of actual graduates’ earnings would have nearly the same impact as no accountability at all. Unfortunately, using BLS estimates instead of real earnings data would not only tell prospective students very little about the quality of the program that they are considering, it will actively mislead them. More troubling still, this approach would prevent the government from holding individual colleges accountable. 

To illustrate just how misleading it would be to use BLS data for the purpose of measuring program outcomes, we compared national and local BLS earnings with actual earnings from graduates of specific career-training programs. We found that, on average, the median annual earnings for graduates of all programs subject to the gainful employment regulations were $27,494. But if local BLS estimates were used instead, the median annual earnings would rise to an average of $49,341—an increase of $21,847, or nearly 80 percent…..