A Federal Rule Could Shut Down 92 Percent of Cosmetology Programs and the Industry Is Fighting Back

The beauty industry is facing one of the most serious regulatory threats it has seen in years, and it has nothing to do with product safety or licensing. It is about a federal education rule that, if it stands, could wipe out most cosmetology programs in the country.

What the Rule Actually Says

The U.S. Department of Education introduced an earnings-based accountability provision called the "Do No Harm" rule. On paper, it sounds reasonable enough. Career training programs that receive federal funding, like student loans and Pell Grants, must demonstrate that their graduates earn more than someone with only a high school diploma. Programs that fail that threshold two out of three years lose access to federal financial aid.

The problem is that the rule does not account for how the beauty industry actually works.

The Professional Beauty Association, the American Association of Career Schools, and a coalition of industry advocates have been sounding the alarm. Their analysis shows the rule would financially disqualify roughly 92 percent of U.S. cosmetology programs, cutting them off from federal student aid and effectively closing many of them down.

Why the Numbers Are Misleading

The earnings threshold sounds fair until you look at what it is actually measuring. Early-career beauty professionals often report lower income because they are building a client base, which in this industry can take five to seven years to fully develop. Tips are widely underreported in official wage data. Many established stylists operate as independent entrepreneurs and minimize their taxable net income through legitimate deductions. None of that complexity shows up in the federal data the rule relies on.

Beyond that, the rule treats cosmetology programs the same way it treats degree programs at four-year universities, which is an apples-to-oranges comparison that does not reflect how career training pathways work. Someone who completes a cosmetology program and earns their license is entering a skilled trade, not competing for the same jobs as a college graduate.

The American Association of Career Schools points out something else worth noting: cosmetology programs were specifically excluded from this accountability requirement when Congress passed the underlying legislation. The Department of Education added them back in during the rule-making process, which AACS executive director John D. Russell has called out directly. The department essentially added a category that Congress deliberately left out.

What the Industry Is Doing About It

The comment period closed in May, and the rule is currently set to begin tracking programs in the 2026-27 academic year. The first potential loss of funding eligibility would hit in 2028 to 2029, which gives the industry a window but not a wide one.

Advocacy organizations have been pushing back through public comments, congressional outreach, and direct engagement with the Department of Education. The Professional Beauty Association has been leading a coalition effort to get the rule either revised or reversed before it takes effect.

The stakes here extend well beyond schools and administrators. If cosmetology programs lose access to Pell Grants and federal loans, enrollment will crater. Fewer students means fewer licensed professionals entering the industry. For salon owners already dealing with a tight labor market, a shrinking pipeline of new talent is a real and immediate business problem.

Why This Should Matter to Every Working Pro

It is easy to see a story about federal education policy and think it does not affect you. But the next generation of stylists, colorists, and technicians coming into this industry are going through these programs right now. The affordability of that education depends heavily on federal aid being available.

The stylists who trained alongside you, who work in your salon, who will eventually take over your chair one day, many of them could only get there because of Pell Grants and student loans. A rule that cuts off that pipeline does not just hurt schools. It reshapes the entire workforce over time.

The industry fought to build the access and the infrastructure that makes it possible for talented people to enter this trade regardless of their financial background. That is worth protecting. And right now, it needs people paying attention.