Amazing Stat of the Day (U of Phoenix Edition)

The Daily Beast has a piece on the woes of the University of Phoenix:  Death of a Diploma Mill: University of Phoenix Going Down in Flames?

There is a lot to be said about this, but I do not have the time at the moment.  Regardless, I was truly shocked by the following stat:

According to Department of Education data, the University of Phoenix online campus has a graduation rate of 7.3 percent and a loan default rate of 19 percent—5 percent higher than the national average.

Wow.  That truly surprises me—and is thoroughly damning. (And that is within 6 years, not 4).

The only good news is that it is harder to call the place a “diploma mill” if they aren’t producing very many diplomas.

FILED UNDER: Education, US Politics, , ,
Steven L. Taylor
About Steven L. Taylor
Steven L. Taylor is a Professor of Political Science and a College of Arts and Sciences Dean. His main areas of expertise include parties, elections, and the institutional design of democracies. His most recent book is the co-authored A Different Democracy: American Government in a 31-Country Perspective. He earned his Ph.D. from the University of Texas and his BA from the University of California, Irvine. He has been blogging since 2003 (originally at the now defunct Poliblog). Follow Steven on Twitter


  1. trumwill says:

    I know two people who teach classes (or have taught them) for UoP, a police captain in Louisiana and a lawyer in California. From what they report, that graduation figure is even worse than it sounds. These are people who aren’t clearing a very low bar.

    Grand Canyon University, another one on the Hall of Shame, recently became the first for-profit institution to sponsor a Division I athletics program. in the WAC, no less (well, what’s left of the WAC).

    (Also, though I know what you meant, your last sentence/paragraph needs some cleaning up.)

  2. TheoNott says:

    It’s an interesting stat to me because you would assume that a for-profit institution would have the greatest incentive to graduate their students, i.e. supply the customer with the “product” they paid for. But I guess they have to maintain some bare minimum academic standard to hold onto their accreditation.

  3. Ron Beasley says:

    I have thought for some time that most of the things that are wrong with higher education in this country are the result of student loans.

  4. OzarkHillbilly says:


    because you would assume that a for-profit institution would have the greatest incentive to graduate their students,

    That’s where you are wrong. For profit institutions have as their goal to maximize per share dividends by wringing the greatest amount of money from their students in the least amount of time while spending not a single dime more than they absolutely have to. The UofP was always going to go bankrupt, it was just a matter of when. They have sucked their students dry and left them holding the student loan bag.

  5. Slugger says:

    Does this mean that I should add education to the list of things that get poor results under for-profit economic models? If I keep reading this site I may turn into a raving leftist. I am going out to buy a Che t-shirt right now.

  6. James Pearce says:

    I work with a guy heavily in debt to UoP and, it’s true, the cost to benefit ratio is outrageous. No degree, but that monthly payment never sleeps.

    However, what shall working people (often those with children) do to educate themselves? Participate in a MOOC? I can see how someone might think going to UoP would be their best option, even if it’s not any better than the local community college and twice the price.

    In a more general sense, I think America’s employers, as the primary beneficiary of an educated population, should participate a little more. Maybe we should try giving employers tax breaks for tuition reimbursement?

    True story: When I worked for the phone company, I talked to a guy who was very confused. “I’m trying to call the University of Phoenix,” he said, “but it’s a California number.” This is when I explained to him, that unlike, say, DU or Pitt, the University of Phoenix has nothing to do with the city.

  7. Just 'nutha ig'rant cracker says:

    A number of years ago, a friend of mine was working for the media services division of one of the major Christian liberal-arts universities. A major portion of his job was producing the videos of professorial lectures that went out to students doing distance education. When he asked about the extra work for professors handling distance education offerings, one of the administrators seemed to have admitted to him that the university’s main interest in distance education was its cash cow qualities. Approximately 85% of all distance education students at this school failed to complete their courses in the time permitted. That rate appears to have been fairly reliable across the range of DE offerings at the time. Things may have changed some, but I see no reason to believe any changes to be particularly dramatic; however, DE courses where students are required to maintain contact with the campus via on-line discussions, etc. (not a feature at U of P, IIRC) do have a higher completion rate.

    That school was only offering individual, continuing-education courses. It doesn’t surprise me at all that U of P would have a higher non-completion rate for whole programs.

  8. Pinky says:

    I thought the whole point of online classes was that you wouldn’t have to quit your job to take them. Why are people getting student loans for online classes?

  9. trumwill says:

    @Pinky: A lot of people don’t earn enough from their day jobs to pay for the schooling, but nonetheless need their day jobs to pay their bills.

    (Oh, and hey Pinky long time no see!)

  10. @Slugger:

    Does this mean that I should add education to the list of things that get poor results under for-profit economic models?

    I think the answer is yes. Private not-for-profit clearly works. I have profound doubts that for-profit can work, and certainly what we have seen to date reinforces that fact.

    Part of that problem is that student-as-customer model is fraught with difficulties. To be simplistic, but to make the basic point: the customer may always be right, but the student most decidedly isn’t.

  11. @Pinky: As Trumwill notes: college is expensive (especially at Phoenix).

  12. @James Pearce:

    However, what shall working people (often those with children) do to educate themselves?

    There are legitimate online programs out there from public universities–indeed, ample opportunities exist.

  13. Mikey says:


    Why are people getting student loans for online classes?

    Well, college is expensive, you know? 😉

    Seriously, though: many times even reputable non-profit public colleges/universities are considered “out of state” for the student and charge the higher out-of-state tuition, so a full-time employed person with decent pay might still need to take loans to swing the whole bill.

  14. trumwill says:

    I honestly don’t mind the high wash-out rates. It’s the combination of wash-out rates and the high costs (regardless of whether the cost is being born by the state, students, or parents) that I see as the problem.

    I was looking into online colleges a few years ago. There are some comparatively* affordable options out there even if you are not in state. North Dakota (in fact, it seemed like all the major Dakota schools but UND had the most rigorous program) waives out-of-state, and SLT’s Troy either does the same or was otherwise not too unreasonable. The best used to be Wyoming, which not only waived OOS but has an inexpensive system to begin with. (Unfortunately, Wyoming changed and now does start charging you OOS.)

    The big name schools, like Maryland and Arizona State, do charge a lot. Right now the best option seems to be WGU, but alas, they have no football team. 🙂

    * – comparatively does some heavy lifting there, for sure.

  15. Mikey says:

    @trumwill: I did my MS in telecommunications through Maryland. Even though I live right next door in Virginia, I still got socked with out-of-state tuition. You’d think they’d have given me a break! LOL

    Had they offered it at the time, I’d have gone through Virginia Tech’s online MS in IT. It would have been a lot less expensive. Unfortunately they didn’t spin it up until a couple years after I was already done at Maryland.

  16. Trumwill says:

    @Mikey: Cost differences were huge. Per credit hour, Wyoming was 130, North Dakota 200, Troy 250, Houston 400, and Maryland and Arizona State 500.

    Right now we live right on a state line, a stone’s throw from two states with great colleges. I’m hoping if we stay where we are that one of them might consider our kids worthy of some sort of discount.

  17. JohnMcC says:

    @Mikey: Now you know they’re not kidding when they say Maryland is for crabs.

  18. bill says:

    reminds me of that poor sob that got his mba from strayer- and was robbing banks to pay the loans….
    anyhow, these predatory online sites do all the leg work for their students- just like a regular college, and make sure they sign the dotted line for the loans they get stuck with.
    i’ve never seen a u of phoenix grad, aside from on tv.

  19. HarvardLaw92 says:

    @James Pearce:

    However, what shall working people (often those with children) do to educate themselves?

    There are quite a few reputable non-for-profit programs available, including several associated with / which are offered by state universities.

    UMUC in my native Maryland comes to mind. It doesn’t have the cachet that UofM would, but its reputable, accredited and from what I’ve been told, academically rigorous, especially in their IT related programs.

  20. grumpy realist says:

    @Pinky: Because you may be making so little that you have no money left over for any courses at all if they charge for tuition.

    (Really, we have to explain such simple facts of life to you?!)