Industry in crisis?
As government enacts new measures, out-of-school training reaches turning point
Chinese parents have been scrambling to register their children in out-of-school training classes, as they believe such training may help their kids get into a better school. The phenomenon recently drew the government’s attention, prompting authorities to launch restrictive measures. Industry insiders said that the tightened policy might lead to a dim future for those once popular institutions.
The fierce competition among Chinese youth in the schooling system has helped breed the rampant growth of out-of-school training institutions.
However, such phenomenon is now experiencing a turning point after the government recently launched policies to rein in the sector.
The tightened government policies on out-of-school training have caused many extracurricular education companies to adjust their business strategies.
In particular, several government departments, including the Ministry of Civil Affairs and the Ministry of Education, launched a set of guidelines in mid-February forbidding out-of-school training institutions from organizing examinations or contests for middle school or primary school students.
The guidelines also stressed that schools and training institutions will be held accountable if they attribute outof-school training results to students’ enrollment in schools.
In addition, the guidelines stressed that out-of-school training institutions are not permitted to teach school subjects in advance or teach what is not included on the standard school syllabus regarding subjects like the Chinese language or mathematics.
Preparing for change
The tightened policies are now biting into the out-of-school training industry.
The Beijing-based Xueersi Education Science Co, an out-of-school educational training agent, recently ended a contest it previously hosted titled the Xueersi Cup, which mainly tested children in subjects such as the Chinese language, English and mathematics, a customer service personnel from the company told the Global Times.
“We will not hold the contest anymore,” the customer service representative said on Monday.
But this is not an isolated case. According to media reports, the Hua Luogeng Golden Cup, a national mathematics contest launched in 1986, was temporarily suspended recently. Hua was a famous Chinese mathematician.
Although such market change is new, people in the industry are concerned about the dire consequences already caused by the policy adjustment.
According to an article published by consultancy site qianzhan.com in August 2017, the market for extracurricular primary and middle school student training had reached about 680 billion yuan ($107.3 billion) by the end of 2016, with the overall educational training market reaching about 2 trillion yuan by that same time period.
By the end of 2020, the market for educational training will likely surpass 3 trillion yuan in revenue, the article noted.
A former employee of a major domestic training institution told the Global Times on Monday on condition of anonymity that she recently quit her job in the sector out of uncertainty for the future.
“Three of my former colleagues quit around the same time as me,” she said. “We are quite concerned about how the recent government policy change would influence the out-of-school training industry in the long run,” she said, adding she feared that the profitability of those institutions would greatly shrink in the future.
Good money
The Global Times also interviewed several parents whose children had attended such out-of-school activities. One mother named Li Huang said that the registration fee for the competitions was not that expensive.
“My child is now a second year high school student in Nanjing [capital of East China’s Jiangsu Province], and he once participated in a national math competition during middle school. The registration fee for that contest was about 150 yuan. It was not too much,” Li said, adding, however, that in order to attend the contest, the family had to pay for transportation and accommodation on top of that fee.
On Monday, another mother living in Shanghai, whose daughter had participated in some educational competitions during middle and primary school, spoke to the Global Times on condition of anonymity and confirmed that the registration fee for those contests was not very high – “maybe just dozens of yuan,” she said.
However, the organizers of such contests would often host special training classes in preparation for the competitions and charge parents thousands of yuan, the mother added.
She also noted that in the past, such contests were usually attended by only elite students with excellent scores, but nowadays, it has somewhat become “routine” for regular students who want to compete in order to gain some extra chips for their future education.
However, the aforementioned training institution ex-employee disclosed to the Global Times that contests were in fact not the main income source for out-of-school training organizations, stating that instead, most profits came from training classes for such major school subjects like English.
“Overall, the industry’s profits were generally handsome,” she said, though not disclosing actual numbers.
Pan Xiaoer, a mother from Yuyao, East China’s Zhejiang Province, said that her daughter, currently in kindergarten, is already attending five extracurricular training courses, including English and dance.
“We spend between 1,500 yuan and 2,000 yuan each month on those courses,” she told the Global Times on Monday.
“As parents, we know that many of those training institutions don’t have qualified teachers, but we are still forced to [send our children to attend] those classes as enrollment competition is so fierce.”
“If you don’t study out of school, you lag behind in school,” she said, adding that although the effects of the local government curbing measures have not fully manifested yet, she believes that in the future, there will be big changes.
Best days are gone
Huang Rong, deputy director of the office for educational administration at a middle school in Nanjing, told the Global Times on Monday that it’s important for the government to set detailed rules on out-of-school classes in order to regulate the market through measures such as controlling lesson content, required teacher qualifications and charging standards.
However, this is not a ban on all outof-school training institutions for now, reassured Han Ping, deputy director of the Education Department of Zhejiang Province.
“For those students who are interested in mathematics and have a talent in it, it’s good for them to compete in out-of-school contests like the Mathematical Olympiad,” Han told a group of primary school students in a video clip acquired by the Global Times.
“With the deepening of the policy, as well as the increase of in-class education quality, the [core] focus of education will finally turn to in-class teaching. It’s becoming a trend,” Huang said.
“Under the current policy, those once extremely popular out-of-school training institutions may not suffer in the short term, but their best days are certainly gone,” Huang said.