China’s education industry


This article is taken from the Focus magazine by CBBC in May 2018.

The impact of the 2018 Chinese government education industry work report by Ciccie Feng, Director of Education and Training, CBBC China. The Chinese Government’s latest Work Report was released on 5th March 2018, during the 13th National People’s Congress, and gives a comprehensive update on changes that took place in China from 2013 to 2017. In response, CBBC has selected some key content from the report, provided relevant background information, and analysed the report’s prospective impact on China’s education sector.

1. POPULATION CHANGES

1.1 Key points in the report

  • More than 80 million people moved from rural to urban areas, resulting in an increase in the proportion of people in China living in urban areas from 52.6 percent to 58.5 percent.
  • 66 million additional employment opportunities were created in cities.
  • The “two-child policy” was implemented.

1.2 Background information

The proportion of Chinese people living in urban areas has been increasing for many decades, and is predicted to reach 60 percent by 2020, as shown in Figure 1.

Figure 1: Urban population as a proportion of the total population in China

Source: National Bureau of Statistics of China, China Industry Information
Note: 2018-2020 figures are predicted

The “two-child policy”, announced in 2015, is estimated by the Chinese academic journal, ‘Progress in Geography’, to increase the size of China’s population by 1.25 percent per annum between 2015 and 2020, higher than the 0.61 percent average annual increase between 2010 and 2015.

1.3 Impact on the education industry and opportunities for the UK

Increased migration of China’s rural population into second and third tier cities, where living costs are lower and public services are easier to register for, will mean that the proportion of people living in urban areas will increase. This will heighten the demand for early years, primary and secondary education, as well as vocational training in cities, leading to more opportunities for education providers.

China’s expected population increase will also have potential benefits for UK education providers, as they follow this larger generation of children through their school years.

2. CONSUMER BEHAVIOUR CHANGES

2.1 Key points in the report

  • The Consumer Price Index increased by an average of 1.9 percent per year.
  • Consumer purchasing’s contribution to economic growth increased from 54.9 percent to 58.8 percent.
  • The number of international trips by Chinese tourists increased from 83 million to 130 million.

2.2 Background information

The contribution of consumption to Chinese economic output has been climbing for over a decade (see Figure 2), which has resulted in an increase in demand for education services. In the last quarter of the 2016/2017 fiscal year, Tomorrow Advancing Life, a provider of technology-based education services in China, saw net revenues rise by 80.7 percent year-on-year, and total student enrolment increase by 69.6 percent, while between 2012 and 2016, the number of Chinese students studying internationally expanded by 36.3 percent to reach 545,000.

Figure 2: The contribution of consumer purchasing to GDP in China

Source: China Industry Information

2.3 Impact on the education industry and opportunities for the UK

Diverse and tailor-made education products, such as study tours and overseas boot camps focussing on technology, art, and innovation, will continue to develop in China due to increased demand for high-quality education. As overseas travel becomes more accessible, the tourism and education industries will become more assimilated, resulting in opportunities for UK education institutions to develop integrated products with tourism companies.

CBBC therefore expects to see an increase in demand from Chinese consumers for overseas education services that promote personal development and soft skill such as: critical thinking, teamwork, communication, and research.

3. INVESTMENT IN SCHOOLS AND HIGHER EDUCATION

3.1 Key points in the report

  • The national budget for education was more than 4 percent of China’s total GDP.
  • First-class universities and top level courses continued to be established.
  • Made in China 2025 continued to be implemented.

3.2 Background information

As Figure 3 shows, over the last three decades spending on education in China has increased as a proportion of China’s GDP. In comparison the UK’s spending on education has stayed between 4 percent and 6 percent of GDP in recent decades.

Figure 3: Spending on Education in China as a Proportion of GDP

Source: Qilu Wanbao

In recent years the number of private schools has increased in China, with Figure 4 showing a significant increase in the number of primary and middle schools. Alongside this, the number of international schools has almost doubled since 2010, as can be seen in Figure 5. Taken together, this demonstrates increased diversification of the Chinese education system.

Figure 4: Number of private schools in China

Source: Sohu Learning

Figure 5: Number of international schools in China

 

Source: IEduChina

3.3 Impact on the education industry and opportunities for the UK

China’s budget for education has increased, as has private investment. CBBC anticipates the latter will continue to rise as public provision of education becomes stretched. This will create opportunities for UK educational institutions to collaborate with Chinese investors and the Chinese state in order to invest in both private and public education, and to develop strong international strategies and comprehensive cooperation with Chinese institutions.

Public universities will continue to receive financial support from the government, and private universities will focus more on developing classes in specialised subjects within the vocational and professional fields. Combined with the Made in China 2025 initiative – a large-scale government-led programme to upgrade China’s manufacturing capabilities and move the country’s output towards high-quality products – intelligent manufacturing will become a critical area in China’s industrial transformation. As a result of this, China will require its education system to produce a large number of skilled individuals in areas including advanced manufacturing, digital technologies, and new and advanced materials.

High school education, which is not yet compulsory in China, continues to be promoted by the government to try and increase the proportion of children that stay in the classroom until the age of 18. Alongside this, private high schools will continue to be encouraged where policies that make private investment easier are in place. Private investment into compulsory primary and secondary schooling in China has been rising, including from international sources, with growth observed in international and bilingual private schools that could benefit British education providers.

4. TECHNOLOGY UPGRADES IN EDUCATION

4.1 Key points in the report

  • Implementation of the Internet+ Act in education.
  • Implementation of the Big Data Development Act, with an aim to create a new generation of Artificial Intelligence (AI) in both research and its application.

4.2 Background information

The Internet+ Act, passed in 2015, aims to promote the integration of online technologies and industries that do not traditionally rely on the internet, while the Big Data Development Act, also passed in 2015, encourages efficient administration through the sharing of data within the government and private industry.

4.3 Impact on the Education Industry and Opportunities for the UK

Chinese education will move towards a combination of online and offline methods as fixed and mobile internet services become fully utilised, as can be seen in English learning, where online classes and app-based activities are combined with traditional teaching materials. The implementation of AI, big data and cloud technology (‘ABC’) in various fields of education, such as curriculum development, will continue and will be further integrated. More digital campuses will be established, where strong internet integration across an institution allows information and resources to be easily shared.

Technology will also continue to be used in wider contexts, such as the use of live streaming and recording classes to improve standards and safety – a trend especially prevalent in nursery schools to help parents observe their children’s progress and well-being.

These changes will create further opportunities for international cooperation in STEAM education, vocational education and teacher training, and also for international organisations that provide related services, equipment, and educational resources.

5. INNOVATION AND EMPLOYABILITY

5.1 Key points in the report

  • Promotion of public entrepreneurship.
  • Improvement in the level of innovation.
  • Development of large-scale vocational training programmes.
  • Use of the Internet+ Act to develop new forms of employability.

5.2 Background information

It is estimated that by 2020 the value of the vocational training market in China will be GBP £126.83 billion (RMB 1,110 billion), with 23.5 million people participating in vocational education.

5.3 Impact on the education industry and opportunities for the UK

Spurred on by corporate innovation and Chinese policies to encourage the development of a digital economy, China’s education agenda will focus on innovative talent training. As well as this, there will be deeper integration between institutions and industries from teaching, learning, and research, especially in the areas of school-enterprise cooperation, professional development, and the development of vocational training. This aligns with UK capabilities, creating opportunities for UK institutions, educational providers, and industries to develop comprehensive cross-sector collaboration with China.

Unless otherwise stated, all changes are over the period 2013-2017.

To learn more about the education market or how to develop your business in China, please contact:

Ms Ciccie Feng, Director of Education and Training, China-Britain Business Council, China Ciccie.Feng@cbbc.org.cn

Ms Nathalie Cachet-Gaujard, Director of Education and Training, China-Britain Business Council, UK Nathalie.Cachet-Gaujard@cbbc.org

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