The education industry consists of schools, colleges, universities and various private institutions. The education sector can be broadly classified into three categories:
- K-12: This includes the education offered from nursery to the twelfth grade by various public, private and religious schools.
- Higher education: This includes various state-run and private colleges and universities. This also includes Med Schools, Law Schools and Business Schools.
- Vocational education: This includes industry/job oriented education, based on the apprenticeship method of learning.
The education industry is not just restricted to these categories. It also includes ancillary education services, such as after-school tutoring, charter schools, special or alternative education, educational content suppliers and professional development of administrators and teachers.
History of the Education Industry
Education has been practiced since time immemorial to instill social and cultural values. In the ancient times, the education system was verbal, carried out generally by the elders of the family. The writing system developed around 3500 BC, enabling the recording and sharing of information. In most ancient societies, the state of literacy was bleak for centuries.
The education industry was initially associated with law, trade and commerce, religion and civil administration. Formal education was available to only a small fraction of the population. The system developed in most countries after 1850 CE.
The modern education industry consists of training by professionals and organized instructions with respect to systematic curricula and pedagogy.
Demand and Supply Drivers of the Education Industry
The demand drivers of the education sector include:
- Household disposable income.
- Cost of education.
- Opportunity cost of education (education versus job).
- Cultural factors (opinion on education of girls).
- Role of government to boost education.
The supply drivers of the industry include:
- Availability of labor force (teachers and administrators).
- Government funding (to establish affordable education centers)
- Changes in social outlook: Campus Universities VS. College Online.
Education Industry: Major Players
Among the premiere colleges across the world, the Ivy League colleges of the US hold an important position. This category of colleges includes Brown, Cornell, Columbia, Dartmouth, Harvard, Pennsylvania, Princeton and Yale.Science, business (particularly Masters of Business Administration or MBA) and accounting degrees continue to be popular course choices.
According to the Chronicle of Higher Education, among the most expensive universities of the world, the top five are from the US. This includes George Washington University, with a tuition fee of $39,240 for the academic session 2007-2008. Rounding off the top five are:
- Ohio’s Kenyon College ($38,140)
- Bucknell University ($38,134)
- Vassar College ($38,115)
- Sarah Lawrence College ($38,090)
The education industry is booming across the world. The industry generates large scale revenues and employment. The revenue from higher education alone in the US is worth over $400 billion. However, the state of the education industry in most developing countries, such as Afghanistan, Bangladesh, Pakistan and nearly all of Africa, is bleak. The literacy rate in these countries is still below 60%.