Panel Paper: Do Employers Prefer Workers Who Attended for-Profit Colleges? Evidence from a Field Experiment

Saturday, November 8, 2014 : 10:35 AM
Dona Ana (Convention Center)

*Names in bold indicate Presenter

Rajeev Darolia1, Cory Koedel1, Paco Martorell2 and Katie Wilson2, (1)University of Missouri, (2)RAND Corporation
Enrollment in for-profit colleges has more than tripled in the past decade, while enrollment in public and private non-profit colleges grew by less than 30 percent over the same time period. For-profit colleges are particularly popular at the sub-baccalaureate level, accounting for almost one-third of associate’s degrees and certificates conferred. There are varying views of the proprietary sector in the higher education market. One perspective views the growth of the for-profit sector in higher education as a market response to educational needs that are unmet by public and private non-profit colleges. However, for-profit colleges have been criticized of late for providing a high-cost, low-quality education and prominent federal agencies have released reports that are critical of the practices of for-profit colleges. Despite the attention, there are relatively few studies that provide empirical evidence on the labor-market returns to attending a for-profit college. We perform a resume-based field experiment to examine employer preferences for job applicants who attend for-profit colleges across seven large US cities and six job categories. Our experiment compares employer call back rates among approximately 10,000 applicants who are randomly assigned sub-baccalaureate credentials from for-profit and public postsecondary institutions. We do not find evidence to suggest that employers prefer applicants who attend for-profit colleges over their public college competitors, and if anything, our results point to employers preferring applicants from public colleges.