Are Immigrants Paying Private Colleges for Empty Promises?

Shortly after becoming a permanent resident in 2013, Alejandro Perez began searching for a job in his field. Because his bachelor’s degree in information technology was one of the reasons he was admitted to Canada, Perez was caught off guard by the odyssey that would unfold.

“In order to work in your field you need Canadian experience,” Perez says, noting that having worked for five years in Calgary’s hospitality industry didn’t count.

For two years, Perez applied to a variety of IT-related positions, with no luck.

He was working at a warehouse, earning about $14 an hour, when he faced an additional challenge: Perez’s wife was pregnant with the couple’s first child.

“I was getting desperate,” he says.

To improve his employment prospects, in 2015 he enrolled in CDI College, a private post-secondary institution offering diploma and certificate programs. CDI operates in five provinces across Canada.

Unlike other institutions he’d approached, this private career college offered the flexibility he needed and didn’t require him to take additional English courses.

“I told them I was working night shifts, and they said, ‘Don’t worry, we have really good schedules,’” Perez recalls, noting that “the sales people are very persuasive.”

In 2017 he graduated from CDI College with a diploma in network systems administration — and $18,000 in debt, an amount he’s been unable to pay back and that has since doubled.

“CDI College is the most expensive line on my resumé,” Perez says.

Yet it failed to deliver the future he yearned for and employment in IT remained elusive.

“I realize that going there, for lack of a better word, was crap,” Perez says.

“They didn’t even teach me anything new.”

Despite the many red flags Perez observed along the way, including a lack of experienced instructors with industry connections and underwhelming courses, Perez brushed off his worries about the quality of the education he was receiving. “Because this is Canada, you don’t think they have this problem.”

In a statement, a CDI College spokesperson recognized that despite the organization’s efforts to provide programs that meet industry needs and provincial regulations, some students may be dissatisfied with the organization’s services.

“We are glad to report the majority of our graduates are happy with the quality of education and services our college provides,” wrote the spokesperson, asking The Tyee to connect the graduate with CDI if they had specific concerns.

But the problem goes beyond Perez’s experience.

A 2022 CBC investigation showed Canada has a problem with private career colleges misleading vulnerable students. The question is why these organizations continue to operate with minimum oversight.

As Alberta’s immigrant population steadily grows, protecting newcomers from exploitation is important.

According to Anila Lee Yuen, CEO of Centre for Newcomers in Calgary, credentials deemed sufficient to immigrate are not always recognized by professional accreditation bodies and employers. So newcomers resort to career colleges that promise the coveted Canadian experience, often misleadingly.

“The more newcomers that come into the province, the harder they may find it to get employment, and the easier it is going to be for some unaccredited career colleges to prey on newcomers.”

The raison d’être of private career colleges in Canada is to respond to specific labour market needs not covered by public institutions, offering training in occupations such as trucking, hairstyling and entry-level positions in business, health care and technology — but not all private career colleges follow the same standards.

While most private colleges are incorporated as a business, a few have obtained non-profit status. Because non-profit career colleges usually receive public funding, governments are required to ensure they act in the public interest, says Glen Jones, a professor of higher education at the University of Toronto, which leads to high-quality programs. By contrast, for-profit colleges exist to make money.

“Private colleges are about attracting the students that will pay the fees,” he says. “That doesn’t mean that some colleges are not high quality, but it does mean that the motivation and the drivers are slightly different.”

Unlike publicly funded private colleges, for-profit private career colleges are generally regulated by provincial consumer protection agencies more concerned with what happens if a business goes under than with the quality of the education provided or the employment prospects of graduates.

“Private institutions are held accountable by governments for their consumer interactions,” Jones says. “The expectation is that if they can’t generate revenues, they will probably not offer that program; that they will be more market responsive because they need to in the context of the bottom line.”

This responsiveness is reflected in their programming. By offering flexible schedules and admission cycles, for-profit private career colleges cater to the needs of underserved communities whose busy schedules limit their availability to study.

In a drive to bolster their bottom line, some private colleges resort to deceiving tactics that overwhelmingly affect new Canadians, many of whom end up drowning in debt and earning bogus degrees employers don’t recognize.

“The starting point is that private colleges want to make money; that’s a given,” Jones says. “The question is, simply, that the province can ensure that the quality of education is appropriate, whether it’s in the public sector or in the private sector.”

Currently, the onus is on consumers to do their research before enrolling in a post-secondary institution. But as private career colleges increasingly benefit from publicly funded student aid, some are calling for expanded provincial oversight.

In Alberta, learners enrolled in a designated post-secondary program are eligible to receive student aid (except for those taking programs such as literacy training, language instruction and continued education, among others).

Programs are designated for student aid eligibility based on the college’s accreditation status, learning outcomes, required credits and number of instructional hours. For a private career college to become accredited in Alberta, it must comply with the Private Vocational Training Act.

About 90 per cent of private career colleges in Alberta are accredited, including CDI.

“It’s impossible for a student to determine which colleges are problematic and which ones are high quality, other than word of mouth,” says Courtney Mo, manager of public policy research and evaluation at Momentum, a Calgary-based charity focused on economic development.

“There’s no public display of compliance issues or problematic colleges; it’s very difficult to determine which one would be a worthwhile investment.”

In 2022, after noticing a concerning pattern among its clients, Momentum put forward a set of recommendations to improve protections for the 25,000 Albertans who attend the 190 private career colleges licensed by the province.

“We’re asking to update the minimum standards in the legislation and the regulations,” says Mo. “So that students can feel confident that when they’re spending tens of thousands of dollars on a post-secondary education, it will be of a good quality, and that it’s likely to lead to good job prospects.”

The Alberta government has implemented some of the recommended changes, but not all. Last year, the province temporarily paused approvals for new programs at some colleges, simplified the complaint process, increased compliance and audit staff and capped the number of students to receive student aid in 2024.

However, to protect vulnerable students, a major overhaul of the Private Vocational Training Act is needed, especially as the province is set to enable the expansion of the industry.

“The legislation and regulation need a full review, and likely updates,” Mo says. “We need to make sure that the new legislation and regulation is loud and clear around who can start a private college, and that there’d be good background checks — who’s applying and who would be running a college?”

Entrusted with the delivery of post-secondary education, private career colleges are not a regular business, she adds. “We’re talking about something vital to our economy and social fabric.”

Increasing provincial oversight would also ensure that some of the changes recently implemented won’t backfire.

Because private career colleges often rely on private lenders to provide high-cost loans to students, Momentum is attentive to how for-profit colleges react to the cap on student aid and whether this drives private career colleges to promote “fringe” financial companies, Mo notes. “Similar to a payday loan, or a very high-cost loan, [private lenders] are selling student loans.”

Regardless of the province’s actions, employer discrimination against newcomers with foreign qualifications remains at the root of this issue, leaving new Canadians like Perez vulnerable to the predatory practices of for-profit colleges and private lenders.

“Newcomers are especially targeted because of the systemic discrimination they already face in the labour market,” explains Lee Yuen of the Centre for Newcomers in a 2023 report.

In the first three quarters of 2023, 43,595 immigrants arrived in Alberta. Those with foreign qualifications are likely to experience challenges similar to those of Perez, who finally landed a job in IT last December, six years after graduating from CDI College — and more than a decade since his search began.

“Vulnerable people in our community are being saddled with really high loan amounts, thinking that they’re investing in their career,” Lee Yuen says. “They believe that if they get a Canadian credential, they’ll be able to move forward.

“They’re ready to work, they’re ready to study and they get taken advantage of.”