Parents in China fuel fast-booming early education market

BEIJING • In a Lego education centre in Beijing's Dongcheng district, Cong Cong and other children watch videos of submarines. After their teacher explains some basic physics, they build their own submarines with Lego.

Lego is a popular extra-curricular class. Cong Cong, six, also attends an English class and swimming lessons. In the eyes of Ms Chen Chen, Cong Cong's mother, English is "a must" , Lego "stimulates creativity" and swimming "enhances physical fitness and coordination".

China's education market has developed rapidly, especially in large cities. Piano, painting, chess, skating and other lessons are springing up in major shopping districts. Expensive summer camps claiming to broaden children's horizons are also popular. Spending on children's education is rising each year.

A survey on Shanghai early education (zero to 6 years) conducted by the Shanghai Association for Quality found that 60 per cent of children under six attended extra-curricular classes, with the proportion of children aged between four and six surpassing 70 per cent.

On average, each child attends two classes for around two hours a week. The average annual family spending on extra-curricular classes is 17,832 yuan (S$3,700).

Ms Chen, a mother of two sons, learnt that most of the children in a son's kindergarten attend several classes, which their parents carefully arrange.

Born in the 1980s, she is a typical parent with higher education and disposable income. Compared with her thrifty parents, she spends more freely on the next generation's early education.

Ms Chen grew up in the exam-oriented system and she hopes her children can have more opportunities to cultivate their interests and broaden their horizons.

International market research firm Nielsen found those born in the 1980s are the main force of consumption in China. As most of them are married, spending on family accounts for most of their consumption, for children's education in particular, which makes 55 per cent of their expenditures.

Some foreign companies are now moving to secure a piece of China's education market.

Part of the Lego Group, Lego Education entered China in 2000. It has been providing innovative education programmes for some Chinese kindergartens and schools.

Lego's 2016 annual report shows the Chinese market is one of its fastest-growing markets. Late last year, Lego opened its first Asian plant in Jiaxing, Zhejiang province.

Lego promotes the idea of learning through play. In China, more Chinese parents are paying attention to their children's ability to innovate. They want to stimulate their interest through hands-on experiences instead of rote learning.

With the popularity of overseas study, China's Gaokao (National College Entrance Exam) is no longer the only path to success for many children. The aim of nurturing versatile talents fuels diverse demands. Many Chinese education companies are seizing the opportunity to grow the market.

Deloitte's 2017 education industry report shows as Chinese education policymakers favour Steam (science, technology, engineering, arts and maths) subjects, the number of institutions and companies involved in Steam education has expanded.

Makeblock, a Shenzhen-based company, develops programmable education robots. Founded in 2013, Makeblock first expanded in North America and Europe, where Steam education is mature.

Founder and CEO Wang Jianjun says the company is now turning its attention to the Chinese market as computer programming catches on among children.

Children's online education is also flourishing. VIPKid is an online English education start-up, introducing teachers from North America to offer one-on-one video courses. Its paying users have grown rapidly from 10,000 last year to 200,000 this year.

Investors are also bullish. VIPKid netted financing from both China and abroad. In August, VIPKid finished its series D financing and received investment totalling US$200 million (S$270 million), the largest financing globally for the K-12 online education sector.

However, the growing education market also piles pressure on parents, especially those like Ms Chen, who has two children.

"We have to double the education spending, which means we have to tighten other family spending. So I think twice before enrolling my son in extra-curricular classes, which usually cost more than 10,000 yuan a year," Ms Chen says.

Some parents have lamented on social media that they are not raising children but "cash burners".

According to family education expert Liu Chenglian, some parents spend whatever it takes to give their children an edge, but sometimes they just blindly follow a trend and over-schedule their children.

Dr Cai Weizhong warns parents to keep their eyes wide open. Some education companies are not qualified and the market needs more regulation and supervision. "Children's education cannot rely entirely on the market. The company and attention of parents count for a lot in children's growth."


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A version of this article appeared in the print edition of The Straits Times on October 16, 2017, with the headline Parents in China fuel fast-booming early education market. Subscribe