March 07, 2011, 10:27 AM — When Steven Peabody chose the University of Phoenix for his bachelor's in business and information systems management in 2001 and his MBA in technology management in 2008, he knew he was paying a lot extra to take classes on his own schedule and finish his degrees as quickly as possible.
Some $54,000 in debt later, he's pleased with the education but not so much with the loans, especially since losing his job as a project manager in December 2008. He now runs a small IT services company and teaching at a private college. "If I could go back in time," he might have decided to "sacrifice my time over my wallet" by attending a less expensive, but less convenient not-for-profit school.
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For-profit schools, such as Capella University, DeVry University, ITT Technical Institute, Kaplan University, University of Phoenix, and Walden University have come under increasing scrutiny for alleged deceptive practices that leave students in high debt for jobs that pay little. An August 2010 General Accountability Office study of 15 for-profit schools that receive 89% or more of their revenue from federal student loans found that 4 encouraged fraudulent practices and all 15 made deceptive or otherwise questionable statements (PDF) to the GAO's undercover applicants. And the Obama administration has proposed reducing student loan support to such schools due to concerns over students' inability to repay their loans because of the high costs of their degrees and the low wages many graduates get.
Should IT pros looking to increase their skills, or people seeking to enter the IT profession, consider such for-profit schools? And should employers trust their graduates' skills?