Gainful Employment and Financial Value Transparency Regulations: Visualizing the scope
Phil Hill
November 26, 2023
The recently finalized Gainful Employment (GE) and Financial Value Transparency (FVT) regulations, to be in effect as of July 1, 2024, are proving to be quite confusing. Part of the problem is the Gainful Employment language, which leads people to think of the late Obama Administration version that was successfully challenged in lawsuits and ultimately abandoned during the Trump Administration. But the Biden Administration regulations are far different in scope.
The Big Differences
GE circa 2014 stuck to student loan debt, using a debt-to-earnings (DTE) metric, based on gainful employment academic programs, defined roughly as anything from a for-profit institution that is eligible for Title IV federal financial aid and certificate programs from public and private nonprofit institutions also eligible for aid.
GE circa 2023 changes the details with the new regulations, but more importantly it changes the scope significantly. Added to DTE is a new Earnings Premium (EP) metric that independent of debt looks at earnings of program completers three years after completion and compares it to statewide high school graduate (but not postsecondary) earnings for ages 25-34. There are some exceptions, but that is the idea.
