With Phoenix enrollment falling nearly 14% in the latest quarter, the company plans to close 115 of its 227 locations throughout the country.
Although the “campuses” facing closure are mostly among Phoenix’s smaller locations, the retrenchment reflects a dramatic reversal for Apollo and the industry as a whole. Apollo profits are down more than half from a year ago, and Phoenix enrollment has declined by more than 70,000 students from its peak.
As I noted when reporting on the Kaplan closures, for-profit students represent a bit more than a tenth of the students enrolled in American higher ed institutions, but they account for a quarter of student-loan borrowers and half of student loan defaults. Because the vast majority of for-profit college revenue comes government-backed student loans, these defaults are a significant drain on taxpayer money.
The government has been slow to regulate for-profit colleges as the scope of their malfeasance has become clear, but the regulatory pace has been picking up in recent months. At least as important, students are wising up about for-profits’ defects, and abandoning the schools in droves.
That’s good news, for them and for the rest of us.