Plunge in International K-12 Education
- The number of K-12 international students studying in Anglophone countries plunged dramatically in recent years, from a peak of 210,100 in 2017 to 151,900 in 2021
- This decline is being driven by a mix of macro factors (e.g. the COVID-19 pandemic, rising geopolitical turbulence), competitive pressures (e.g. a rise in domestic alternatives and e-learning options), and emerging trends (e.g. an upswing in local work opportunities, soaring tuition fees, and deferral of migration) in play
- As a result of these forces, we forecast an enrolment shortfall of 94,000 students by 2024, translating to USD 2 billion p.a. in tuition revenues
Digital-led Response
- Many schools have turned to technology-led measures to address these enrolment headwinds, with some senior schools even moving completely online. This shift towards remote learning is being marked by adoption of online material, live streaming, recorded lectures, hybrid classes, flexible scheduling, and increased parental involvement
- However, there remain swathes of technical issues (e.g. digital accessibility, quality of experience, and ability to monitor progress), as well as non-technical issues (e.g. social immersion, time zone differences, and parental support)
- A whopping 65% of students aged 13-17 themselves also prefer classes to be run completely in person after the COVID-19 pandemic is over
- Add to that, parents are concerned about their child’s screen time (63%), social connections (60%), mental well-being (59%), extra-curriculars (58%), exercising (52%), and lack of supervision (31%)
Onshoring To The Rescue
- We believe onshoring has the potential to address many of the challenges facing Anglophone schools suffering from declining international student enrolments
- Asia, in particular, is a key hot spot for K-12 international education, given a variety of academic and non-academic factors sought by both students and parents in the region
- The population of K-12 students who are enrolled in international schools in Asia has grown strongly in recent years, including during COVID-19, from 1.31 million in 2015 to 1.89 million in 2022, a number that we forecast to reach 2.27 million by 2026
- From a quantitative perspective, this burgeoning interest in Asia translates to a revenue opportunity worth USD 19.7 billion by 2026
Early Movers
- Recognising the market potential in Asia, many brand-name schools (e.g. Dulwich, Harrow, Nord Anglia), especially from the United Kingdom (“U.K.”), have been setting up operations in the region, generating vast tuition revenues
- AISL Harrow, for instance, has attracted over 13,000 students to its Asian campuses, generating 12x more fee revenue than it does from its home base in the U.K.
Key Considerations
- The onshoring journey requires schools to consider a variety of factors concerning the market, foundation, preparation, people, operations, and finances of a new school
- However, given the heterogenous nature of the Asia region, each market should be carefully evaluated based on its own strategic, operational, and financial merits
