Articles > Business > Gainful Employment Will Hit Salons Hard
September 30, 2014

Gainful Employment Will Hit Salons Hard



Salon Owners beware! You could soon be facing a disastrous shortage of new licensed recruits if the proposed Gainful Employment regulations are approved in their current form, warns Nuts & Bolts Training, a leading provider of vocational education programs. Basically, if these new regulations pass, your young talent pool could be drying up soon.

The Gainful Employment law, proposed in 2010, ensured that federal funding for higher education would be spent on programs that produce professionals capable of making a living. Unfortunately, many have criticized the methods used for working out how colleges pass or fail the criteria, saying they focus too heavily on students’ short-term borrowing-to-earnings ratio and take no account of overall increases in students’ potential earnings.

The law will also take into account criteria over which beauty schools have little control. For example, if more than 30 percent of a school’s students are defaulting on their loans or exceeding set debt ratios three years after graduation, the school will fail the requirements and eventually lose its ability to offer financial aid.

In light of this law, Nuts & Bolts Training, the foremost leader in business development programs for the health and beauty industry, has issued a warning after carefully reviewing the currently proposed regulations, which have attracted widespread condemnation and predictions that many private sector programs would be eliminated under the ruling, denying millions of students access to post-secondary educational opportunities over the coming decade.

Nuts & Bolts CEO, Jamie Yates, warns the measure will hit the beauty industry particularly hard, saying: “While the intentions behind Gainful Employment are good, the reality is that many graduates may find employment in segments of the beauty industry that may not count as “gainful employment” for purpose of the proposed regulations. As a result, the colleges that supply your salons with new talent could be at risk of failing the criteria for receiving federal aid, forcing many of them to close their doors.”

Gainful Employment affects non-profit, public and for-profit schools alike, with the latter expected to take the biggest hit. Many, if not most beauty school students rely on financial aid to get through school, so salons may face a slump of new recruits without a collective effort to ensure they were employed and continue to develop as professionals after graduation. 

If this comes as a shock and concern, then write/call your local Congress representative to vote YES on these two bills:

H.R. 4897: Transparency in Education Act
S. 2863: Transparency in Education Act

Or visit,