Capital: Beijing

Population: 1.4 billion (2022 est.)
GDP (Purchasing Power Parity):  $23 trillion (2020 est., in 2017 dollars)
Currency: Renminbi Yuan (RMB)
Language: Standard Chinese or Mandarin

 

UNESCO Student Mobility Number
China has 1,088,466 students studying abroad according to UNESCO.

CIA World Factbook
28.77% of China’s population is under 25 years of age.

 

OVERVIEW      

China has the largest state-run education system in the world, with 291 million students and 18 million teachers in over 529,000 schools in 2021 (The Ministry of Education).   Its quality has improved considerably over the last decade due to continuous reforms and large-scale investments.

The Ministry of Education of the People’s Republic of China is the agency of the State Council that oversees education throughout the country.  In 2019, the State Council issued a blueprint for the country’s education development for the coming decade, called China’s Education Modernization 2035.  This plan sets the objective of establishing a modern education system with universal quality pre-school education, balanced compulsory education (grades 1-9), enhanced vocational education, and more competitive higher education.  

SUB-SECTORS

K-12 Education

China has the world’s largest K-12 education market.  In 2019, there were 106 million elementary (grades 1-6) students, 48 million junior middle school (grades 7-9) students, and 40 million high school students (grades 10-12), which together created a market of approximately $120 billion.  Additionally, China reported 47 million kindergarten students (3-5 years old) in 2019, a group excluded from China’s K-12 market definition, but which has demonstrated strong demand for international products and services. [1]

China’s regulations commonly categorize K-12 education service providers as either non-profit or for-profit.  Non-profit entities are mainly schools that provide full-time curricular education.  For-profit entities include private schools, academic extracurricular tutoring, and non-academic extracurricular tutoring.

The K-12 education market has grown rapidly in recent years, resulting in raised social anxiety among parents and students seeking to gain an edge.  Early in 2021, China’s central government enacted tough rules meant to ease pressure on school children and financial pressure on families by regulating and restricting the private tutoring market.  One example is the July 24, 2021 clampdown on the for-profit curricular tutoring industry[2] (http://politics.people.com.cn/n1/2021/0725/c1001-32168735.html).  This policy affects both online and offline tutoring service providers.

Higher Education

China remains the largest source of international students in the United States for the 13th consecutive year, according to the Institute of International Educational Exchange’s 2022 Open Doors Report. The United States welcomed 290,086 Chinese students in the 2021/22 academic year. This figure decreased 8.6% when compared to the previous school year. 

China’s current COVID-19 pandemic control policies have caused testing center closures, increasing the uncertainty and difficulty for students to take standardized tests (SAT/ACT/TOEFL/IELTS). This has impacted high school students’ application processes for U.S. schools, especially for students who desire entry to top American universities.

Undergraduate and Graduate Programs: 109,492 Chinese students were enrolled in U.S. undergraduate programs and 123,182 in U.S. master’s and doctoral programs in the 2021-2022 school year.  The number of undergraduates decreased 12.8% from the previous year, and the number of graduate students increased by 3.6%.

“Over time, the data has been pretty consistent, independent of the state of relationships or political tensions,” said Dr Allan Goodman, CEO of the Institute of International Education.  “Education operates in a different space, and we expect that to continue in respect to China, no matter what the temperature is.”

Community College Programs and Vocational Schools: In the government’s China Education Modernization 2035 plan, one of the six key points is to significantly improve vocational education in China, which creates new opportunities for U.S. community colleges.  In pursuit of this plan, China is building the world’s largest vocational education system to tackle this aging country’s labor shortage problem. Vocational schools are gaining increased government support and seeking international cooperation in vocational education and career development. On the other hand, parents and students at vocational schools remain inclined to higher academic degree programs. U.S. community colleges’ vocational programs and transfer programs can meet both needs. Such programs typically have fewer prerequisites for admission, have more affordable tuition and fees, and offer credits recognized by four-year universities in the United States. 

Education Technology

2022 was a challenging year for the education sector in China. Apart from the global pandemic, the Education industry also experienced local regulatory changes in China’s private after-school tutoring sector. The long-term impact of COVID-19 on education in the China market is expected to lead to an increase in spending on digital infrastructure and new digital models utilizing the new tools available in digital education. Both international students and domestic students have had to adjust their ways of studying by adapting to online learning on various technology platforms.    

As there is still strong demand from the education industry and the support from relevant national policies, the total revenue of China’s education technology market continues to rise, and the scale is expected to reach $75 billion by the end of 2022. However, due to the industry’s high demand for service experience, professional technical services, solid sales channels and other factors, small enterprises and new entrants also face high industry barriers. China’s education technology market has entered a stage of rapid growth from 2017 to 2020, with the total revenue of the industry increasing from $46.4 billion to $61.1 billion, with a compound annual growth rate of 9.6%. In 2020, due to the COVID-19 outbreak, the growth rate from 2019 to 2020 was lower than in previous years and still showed an increasing trend.

(Reference: https://www.163.com/)

Education Technology trends: Hardware equipment sales are the largest component of China’s education informatization market, accounting for 39% of revenue in 2020; It was followed by integrated IT solutions and software services, accounting for 28.1% and 26.4% respectively in 2020.

• Integrated IT solution providers in the education information market are mainly engaged in integrating hardware and software products and bundling their integrated IT solution services to customers in several regions.

• STEAM learning continues to be a major priority for the Chinese market.  The demand for STEAM education and training has seen the booming creation of training programs and startups offering out-of-school courses in coding, robotics, and 3-D printing and attracted the attention of publishers, toymakers, and app developers. 
• Formative methods are supplanting traditional, summative approaches (especially regarding test taking) resulting in more EdTech firms with solutions that focus on formative assessments.

• The mobile education texting-for-homework-help/crowdsourcing market has expanded to include a handful of firms that have developed crowdsourcing apps/web platforms to allow students to answer each other’s questions or to engage quickly with a teacher/expert for help.
• School management systems

 Challenges

• The biggest challenge for U.S. EdTech firms is localization.  Many firms have created education technology to specific curriculum and U.S. state standards.  To adapt their technology to a specific market, whether it be language, standards, curriculum, etc., will increase costs. 
• Finding the right local partner is an important multiplier to market exposure.  Other ways to gain awareness in the marketplace is through e-commerce or targeting private schools and parents.
• Startups in the EdTech sector face a unique challenge in marketing their products worldwide on a limited budget.

• Sales channels can take years to carefully cultivate leading to established well-known brands in the regions in which they operate and established strong relationships with educational institutions. New entrants cannot establish a good brand image and establish good relationships with local institutions in a short period of time.

OPPORTUNITIES

K-12 Education

There is an enormous demand for better education and supplemental learning as both parents and schools seek a competitive edge for their students. Large players might shift their business focus to new frontiers like extracurricular tutoring and vocational education, both of which were not impacted by the above-mentioned regulatory changes.  These and other opportunities are:

1.     Non-academic extracurricular programs that offer all-around education: Such programs are exempt from the government’s recent policy changes and include subjects such as art, computer coding, sports, music, and others.  Chinese parents’ strong belief in personal education investment remains unchanged, especially among those families interested in an overseas college education.

2.     Academic and non-academic pre-college enrichment programs for high school students: China’s tough measures on education have had, and will continue to have, large effects on the nine-year compulsory education (grades 1-9) market, yet barely impact high schools.  High school students who intend to study abroad are eager to get more prepared through these types of courses.  Chinese domestic leaders in this segment, like GEC Academy, reported soaring sales of international enrichment courses in 2020.  Market demand is expected to continue to grow even after COVID travel restrictions are eased.

3.     Boarding schools:  U.S. boarding schools remain appealing to Chinese parents and the U.S. Commercial Service in China (CS China) expects interest to rise as routine international travel resumes.   Up until COVID restrictions made travel difficult or impossible, CS China noted increased interest in boarding schools for the lower grades in addition to high schools, which previously were the most popular options pursued by Chinese families.

4.     Educational toys and games:  Providers of educational toys and games may see the opportunity to emerge as replacements to academic tutoring.  Opportunities exist for both physical products and online learning in the form of websites, software, or apps.

5.     Language training:  Academic language training providers might find it difficult to operate in China, while those who provide programs designed to enhance reading ability, without being specifically designed to tutor speaking, may find opportunities.

Higher Education

In 2020, there were nearly 400,000 children enrolled in English-medium international schools.  The number of international schools in China continues to grow, with 53 international schools operating, 75% of them in lower-tier cities. Unlike students within the public education system, most of those enrolled in international schools choose to study abroad after graduation.  International schools have been and will continue to be important recruiting channels for U.S. higher education institutions.

Statistics (http://en.moe.gov.cn/documents/statistics) show that in 2021, 3.8 million people, both recent college graduates and working professionals, took the postgraduate entrance exam in China, an increase of 11% over the previous year.  With an admission rate of only 35%, nearly 2.5 million Chinese individuals cannot enter Chinese graduate schools. They represent a pool of potential candidates who are seeking to further improve their academic qualifications.  Many of them are financially well prepared. [3] 

Based on research by Sea Master Education, the market for online master’s degree programs is booming.  The flexibility of online learning is appealing to the population between 25- and 45-years old who are unable to study abroad due to the cost of lost job opportunities and for family reasons.  We have also noticed a growing number of U.S. universities launching online master’s degree programs in China. [4]

Vocational Education and Community College: China’s central government encourages international cooperation and exchanges for vocational education.  China has sent delegations to learn from the countries where vocational education is well-developed, received foreign vocational education delegations, invited foreign experts on the topic to give lectures in China, and created partnerships with foreign vocational education institutions.  China also works with international organizations, such as UNESCO, UNDP, the World Labor Organization, UNPF, and APEC, to promote vocational education.

U.S. community colleges and vocational schools hoping to recruit students from China should focus on the unique experiences they offer to students. These can include proximity to major cities, ease of transportation, proximity to natural resources, and unique student community groups.

To further establish an exceptional value – and to provide differentiation in a very crowded market – community colleges and vocational schools should highlight feeder programs and partnerships with higher-level and highly-ranked universities.  Community colleges and vocational schools should also highlight the unique features of their training programs.  Corporate partnerships, apprenticeships, and internship programs are important features to highlight to help schools stand out.

DIGITAL MARKETING STRATEGIES 

With regards to social media and digital platforms, local Chinese sites and search engines are most popular in-country.   The most popular social media sites are Bilibili, Douyin, and Weibo.  Baidu is most used to research information, and Zhipin, LinkedIn, Douban, and 51job are used by students to search for job opportunities.  To stream videos, students use Tencent, Aiqiyi, and Youku.

In-country schools and schools from competitor countries use Douyin, Bilibili, Weibo, QQ, WeChat, Tencent, Aiqiyi, and Youku to reach students and parents about education opportunities.

The U.S. Commercial Service in China recommends that U.S. study state consortia and/or education institutions communicate their unique offerings and experiences to differentiate themselves from competitors, identify champions to provide testimonials and drive digital marketing, and seek best practices from peer institutions, especially those that have successful marketing experience in China.  The champions to provide testimonials can be current students or alumni from China.

EVENTS  

• China Education Expo 2023
• Global Education Technology Summit & Expo 2023
• International Education Equipment Expo 2023
• Global Smart Education Conference 2023

RESOURCES 

• U.S. Commercial Service – China: https://www.trade.gov/china
• Ministry of Education of the People’s Republic of China: https://www.cacie.cn/cn/index.html
• China Education Association for International Exchange: https://en.ceaie.edu.cn/

U.S. COMMERCIAL SERVICE CONTACTS