ITT Tech Collapse:  What It Means for Community and Career Colleges

Posted by Steve Probst on Aug 19, 2016 2:30:00 PM

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Radical cuts at ITT Educational Services, Inc. will have ripple effects across all career education institutions.  ITT is a huge institution, with roughly 40,000 students at 137 campuses in 39 states.  It plans to slash advertising and recruiting, which will cut starts in half, virtually overnight.  These cutbacks could have dramatic effects on nearby community colleges and career schools.  They are also an opportunity for institutions who can fill the gaps left in ITT's markets.

Effects on Career and Community Colleges

  • Bigger Local Employment Gaps:  While you may not love ITT, it produced tens of thousands of graduates who went on to fill jobs in local industries.  Without these graduates, your local employers may not be able to meet their needs for trained workers in many vocations, from computer technicians to nurses.  For example, ITT reported over 10,000 Associate’s-degree graduates last year in computer technology fields and engineering technology fields.  It also graduated over 1,500 Registered Nurses.  Local communities and employers are likely to ask career schools to step up and fill the gaps left by ITT.  
  • Uncertain Enrollment:  Surprisingly, ITT's demise will probably have less of an effect on community college enrollment.  Recent research indicates that for-profit career colleges do not draw from the same student segments as community colleges.  But, ITT spent a lot of marketing money, which stimulated demand not just for its schools, but for all career and vocational schools.  As this spending is cut, fewer students may seek higher education, which may reduce enrollment.  This decline may be offset by current ITT students who transfer to local career colleges after they learn about the school's troubles. 

How Gray Can Help With the Important Questions.  Gray Associates works with public, not-for-profit, and for-profit institutions throughout higher education.  Much of our work focuses on evaluating student and employer demand for programs and campus locations.  To address the ITT situation, we can help institutions:

  • Estimate the effects of ITT’s collapse on the supply and demand for graduates of your programs in your markets
  • Determine which of ITT’s abandoned markets are the most promising locations for expansion
  • Identify the best candidate programs for each potential new location
  • Update your understanding of market conditions for each program you offer, including local and national trends in student demand, employer demand, and competition

For more information on our higher education consulting capabilities or how Gray can help, please leave a comment or contact us.

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Topics: Higher Education