Market update: ISC Global Report

Demand for places at English-medium international schools throughout the Middle East continues to increase, even whilst the region has been bearing the brunt of the slump in the oil and gas market when many expatriate employees and their families were being sent home. Across the region, overall enrolment at international schools increased by 7.8% from September 2015 to September 2016 and has continued to increase into the 2016-17 school year.

Details of all the market developments, plus global and regional trends, and forecasts for the future of the market are available in the new 2017 Global Report on the K-12 international schools market published by ISC Research.

The report indicates continued growth of schools and student intake for the Middle East, which has seen 40.3% growth in the number of international schools since 2012 to a current total of 1524 schools. Student enrolment has increased at an even greater rate, by 49.5% to 1,417,000, generating fee income of US$10 billion.

The United Arab Emirates is the leading country in the world for international schools with 593 English-medium international schools for three to 18-year olds, today meeting the learning needs of almost 600,000 students. Dubai schools have not suffered the impact of expatriate student departure that most other cities in the Middle East have thanks to its more diverse economy.

The UAE, as a whole, is seeing significant developments in the construction and real estate sectors which will continue to attract more expatriates and, as a result, Dubai and Abu Dhabi have several new international school developments in the pipeline.

In Saudi Arabia, the impact of the oil and gas slump has led to renewed clarity for the need to develop alternative revenue streams. With over 30% of the country's population under the age of 15, and a recognition for the need for improved education options, the Saudi Government is planning to increase private sector school provision.

2000 government schools are to be made administratively and financially independent while 3000 small and medium-sized private schools across the kingdom are to be closed as they do not meet standards set out by Saudi Arabia's Ministry of Education. 500 of these school are being saved and improved upon by a $1.3 billion project that has been launched this year between a group of real estate, education and investment organisations, a project that also includes the plan to create 100 new international schools in the country. Opportunities for international school management by foreign providers in Saudi Arabia look good.

Elsewhere, Qatar is investing extensively in infrastructure projects over the next few years and ISC is aware of more than 20 new schools in the planning stages for the country. New developments are also likely in Kuwait.

A GLOBAL VIEW

ISC Research has tracked the global K-12 international schools market since 1994 and its trends show an increasing demand around the world for education in English, for a Western-style of learning, and high school qualifications that are recognised by the world's leading universities and multi-national companies.

In the year 2000, there were fewer than one million students attending 2500 international schools available globally; mostly for expatriate families. Six years ago, these figures had increased to three million students learning at 6000 schools in a much wider range of countries and attracting many more children of local families.

The 2017 Global Report indicates that, as of December 2016, there were almost 4.5 million students attending over 8600 international schools in virtually every country of the world, with the vast majority of student enrolment being local children aiming for higher education in the West.

The greatest percentage growth in regional enrolment at international schools during the 2 academic year was seen in East Asia where the number of students increased by 13%. This occurred primarily in China as a result of the growing demand for English-speaking learning and globally-recognised high school qualifications by aspirational Chinese families. The emergence of a new type of international school in the country — private Chinese-owned bilingual schools offering international learning — is responding to these needs.

The report also highlights some new emerging markets. Myanmar, for example, is at the early stage of major economic development and is experiencing the start of a booming international schools sector. Also in South East Asia, Vietnam expects to see significant growth because of a likely removal of government restrictions for local children attending international schools. Other countries noted in the report with emerging international school markets include Peru, Colombia and India.

ISC predicts the market will continue to develop at a healthy pace, forecasting that by 2021 the number of students attending international schools will have reached 6.3 million. An increasing number of local families are expected to seek out international school places as their reputation continues to expand. Far from being seen as an option for elite and expatriate families only, many local families are investing in international schools to ensure their child has an English-speaking education with learning and qualifications that prepares them well for university.

Fees range from those that are affordable for middle-income families to those exclusive to only but the wealthiest. According to the Global Report, the average annual tuition fees at international schools in East Asia currently stand at $17,272 per year compared to $7,085 in the Middle East.

The report identifies tuition fees in the UAE being 118th in the global list of average annual international school tuition fees. This, obviously, has an impact on the salaries of staff. Although some parts of the Middle East are popular expatriate centres, other locations may struggle to attract enough skilled and experienced staff because of their destination combined with the lower wages.

Professional capital is the biggest challenge for the international schools market as a whole; maintaining the high calibre of skilled, qualified teachers and leaders who are experienced in delivering Western-style curricula and qualifications.

Right now, most schools are managing to attract enough suitable staff, mainly from such countries as Britain and the United States to meet their needs. But with the number of teachers working in international schools expected to increase from 429,000 today to 581,000 in 2021, the need to attract more teachers of the calibre demanded by both the schools and parents, is becoming an increasing concern. Some school groups and universities are now considering a variety of solutions to address future demand. Potential options include upskilling local teachers, remote top-up training, conversion courses, and more.

The 2017 Global Report on the English-medium international schools market is available from ISC Research along with a range of Market Intelligence Reports for key countries (including Saudi Arabia and UAE) as well as statistical reports and benchmarking reports, all of which support investment, development and strategic marketing for international schools.

Author: Nalini Cook, head of Middle East research, ISC Research