Business & Tech

US says for-profit job training programs leave graduates in debt

WASHINGTON — Nearly a thousand career-training programs at for-profit colleges are leaving graduates saddled with debt that exceeds 12 percent of their total earnings, putting the schools at risk of losing access to federal loans and grants, the Education Department said Monday.

‘‘Far too many hard-working students are graduating with certificates or degrees that have little or no value in the job market, and then they’re stuck with thousands of dollars in student loans with no way to repay them,’’ Education Secretary John B. King Jr. told reporters.

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To qualify for federal aid, career schools and community colleges that provide vocational education must ensure that graduates land jobs earning enough to repay their student loans.

A program is considered to lead to ‘‘gainful employment’’ if the annual loan payment of a typical graduate does not exceed 20 percent of their discretionary income or 8 percent of their total earnings. Surpassing those debt-to-earnings rates means possible expulsion from the federal program.

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Roughly 803 of the 8,700 programs reviewed by education officials failed to meet the thresholds, with graduates paying at least 30 percent of discretionary income and more than 12 percent of total earnings toward debt, according to the report.

Ninety-eight percent of those programs are offered by for-profit colleges, while the remaining 2 percent are at private nonprofit schools. No community college programs failed.

Proponents of for-profit colleges took issue with the release of the findings before schools were given a chance to appeal.

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