Career programs — at both for-profits and private nonprofits — are under a lot of pressure to improve two things: student debt loads and postgraduation earnings. With regard to student-debt loads, does Strayer University have any initiatives in place to make tuition more affordable?
We do — in fact I think we've really been a leader in that respect. First, just a little background. The median debt for a Strayer University graduate is in the low to mid-$20,000 range, so call it $23-24,000. We also know — via surveys that we do with our graduates, but also with data that the Department of Education has released — that Strayer graduates do very well. Depending on the program, they have salaries in the high $40,000 to low $60,000 range. So for individuals making that salary on about $23,000 in debt, there's a very tangible payback.
That notwithstanding, we continue to see that affordability is a big issue confronting many families, many students, and we've done two things on that front. About a year ago, we introduced the Strayer University Graduation Fund, which allows a student to basically earn their entire senior year of college. We don't just want to deal with affordability, we also want to try get as many of our students through to graduation as possible. What we'll do to support you is for every third course you complete as part of your degree program, we will essentially grant you one of your last 10 courses in your senior year to be taken for free.
The other thing that we did in late 2013 is we reduced our undergraduate tuition by about 20 percent. When you combine those two programs — the graduation fund and the reduced undergraduate tuition — we've reduced that cost by almost 45 percent in the span of a single year. We also work very hard with our students when they're enrolling in the university to make sure that they're being thoughtful around the amount of debt that they're taking on.
What about steps to improve employment prospects, or starting salaries?
About 25 percent of our students come to us from institutional alliances, which in large measure are educational alliances we have with about 250 Fortune 1000 companies. They send us their employees and we offer them further discounted tuition. The vast majority of students who come to Strayer are already employed, so we don't have a placement function the way that a vocational school might have. But we do do a lot of work with employers to make sure that we're offering their employees a high-quality degree affordably.
A lot of colleges are taking a harder look at their graduation rates, including gathering data on what might help students graduate. What seems to help Strayer students?
When you're thinking about graduation rates, you really have to think about them in various segments of students, because there's massive variability. And so for example, graduate students have very high graduation rates — both here at Strayer and nationally. The graduation rate for our graduate students is, you know, probably 70-plus percent, and they also have incredibly low [student loan] cohort default rates. So graduation rates at the graduate level are essentially a nonissue. Then you have students who have been to college before, they just didn't finish their degree — and they actually have very high graduation rates too, as well as very low cohort default rates.