Fewer students are signing up to attend Apollo and other for-profit colleges amid high U.S. unemployment and federal and state investigations raising questions about the industry’s loan defaults and marketing claims. Competition from traditional colleges’ online courses is also hurting enrollment, said Peter Appert, an analyst with Piper Jaffray & Co. in San Francisco. “Investors are nervous because the general trends in postsecondary education continue to be difficult,” Appert, who has a neutral rating on the shares, said in a phone interview…

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“We’re positioning ourselves to be more nimble, more competitive and more successful for all of our stakeholders in Apollo,” Chief Executive Greg Cappelli said Tuesday on a conference call with analysts.

Via Minneapolis Star-Tribune

Ryan Randazzo at the Arizona Republic writes:

Company officials blamed a tough year for the realignment, which will reduce its real-estate square footage by about 40percent but, because of growing online enrollment, will affect only about 4percent of the student population.

About 250 of the job cuts will be in Arizona, but only one of the nine locations in the state, Nogales, will close. The state is seeing a high number of job losses because the company is headquartered in Phoenix…

Cappelli said the company is working to set itself apart from other companies and to diversify into new markets. “This is a more competitive industry today,” he said. “We have been preparing for this for some time.” The company is striving to branch out globally to places like India and is working in the U.S. with major employers to help place graduates into jobs.

“We know we must offer a value proposition for students … and ensure students can turn their education into a relevant career,” Cappelli said. Officials discussed a program called Phoenix Career Services, where the university has teamed up with companies such as Microsoft and AT&T to help students choose degree programs that align with business needs in their region.

via The Arizona Republic

Alex Vega at the Associated Press write:

At least one location in 30 states is slated to be shuttered. The roughly 4 percent of Apollo students affected by the closures will be given the option of transferring to online programs or moving their course work to other sites, said University of Phoenix President Bill Pepicello.

If no other center is nearby, the company will continue courses at other space near the closed facility until students complete their degrees, he added. The university is in the process of notifying students…

The announcement comes as enrollments overall in the for-profit sector are declining after years of rapid growth, even as enrollment in other sectors of higher education rises. Recent federal figures showed enrollment in for-profits fell 2.9 percent in 2011. The sector has faced tighter regulations and more pressure to enroll students who have a better chance of graduating.

University of Phoenix recently announced a tuition freeze in hopes that will help it retain students and woo others put off by rising education costs. “People are simply holding off investing money in education at a time when the costs are escalating and the outcomes are uncertain,” Pepicello said.

Via The Seattle Times

Tamar Lewin at The New York Times write:

Late last month, Kaplan Higher Education, a division of the Washington Post Company, announced that it was closing nine of its campuses and consolidating four others into nearby locations. The company did not give a reason, but in an August filing with the Securities and Exchange Commission it disclosed that an accrediting commission had warned that its campuses in Baltimore, Indianapolis and Dayton could lose their accreditation — and with it, eligibility for the federal student aid that makes up more than 80 percent of Kaplan’s revenues — for failure to meet student achievement requirements.

As the negative publicity about for-profits mounted — including many charges that the schools enrolled students who had almost no chance of succeeding, to get their federal student aid — both Kaplan and the University of Phoenix announced new programs, offering some form of free trial, to ensure that they enrolled only students who had a reasonable likelihood of success. Those programs cut substantially into their enrollment numbers. “We’ve said publicly that about 20 percent of the students in our free three-week online orientation program either don’t complete the program or don’t enroll,” said Mr. Brenner.

To help boost enrollment, the University of Phoenix last week announced a tuition freeze for students who remain consistently enrolled. Students affected by the University of Phoenix closings will have the option of transferring to the university’s online classes — about three-quarters of its students are online — or moving to a nearby site. Students are now being notified of the changes, and a hot line has been set up at (866) 992-3302 for those with questions.