This special type of for-profit school is taxpayer funded and has an 'overwhelming negative impact' on students

Charter schools — which are publicly funded but privately run — have proliferated across the US since they first emerged as an alternative to traditional public schools (TPS) in the early 1990s.

In recent years, online charter schools have proliferated in the US, too. Online charter schools, also referred to as cyber or virtual charter schools, offer K-12 education where all the classes are provided online.

Students log into their computers to receive instruction from teachers, but much of the learning is also independently driven, with students reading passages and completing work on their own.

But new research conducted by Stanford University’s Center for Research on Education Outcomes (CREDO) found that online charter schools are falling way behind their peers at TPS.

The study found that online charter school students had much weaker growth in maths and reading than their peers in TPS, equating to 72 days of learning lost in reading and 180 days of learning lost in maths.

“This is due to the overwhelming negative impact on student growth from attending an online charter school,” CREDO wrote, citing data from 158 online schools across 17 states and the District of Columbia.

That’s a troubling finding. The average school year is 180 days, according to the Education Commission of the States. So CREDO’s assertion that students lose 180 of learning means they lose an entire year of schooling just by attending an online charter school.

It’s also interesting in conjunction with the surging popularity of charter schools among hedge fund investors.

Hedge funds and other private businesses are particularly interested in the growth and success of charter schools. The growth of charter networks around the US offer new revenue streams for investing, and the sector is quickly growing. Funding for charter schools is further incentivise by generous tax credits for investments to charter schools in underserved areas.

While there haven’t been reports of hedge fund managers investing specifically in online charters, the virtual classroom space is still relatively new, but quickly growing.

The CREDO study noted that in their sample of 17 states and D.C., the students in online schools have nearly doubled from 35,000 in 2010 to 65,000 in 2013.

And CREDO only included schools that were 100% virtual. The online sector is diverse and includes schools that offer a blend of online classes with traditional classroom instruction.

NOW WATCH: This North Korean college graduation ceremony looks an awful lot like a funeral

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.