The Business of Education

Traditionally, the view has been that the government and the religious orders would provide educational services to society. And indeed, both sectors have provided this service for many years, with the government providing schools where the majority of elementary and high-school students enroll and the religious orders and parochial schools providing education for a growing share of students in the secondary and tertiary levels.

Overlooked in all of this have been the private schools owned by families or businesses that have also served the educational sector for the last couple of generations. These universities and colleges have become a hotbed of investment and economic activity in recent years. As student populations grow, and as older generations of owners give way to the next generation, we are seeing a growing—and welcome—trend of fresh investments in education coming from conglomerates that have no strong history in investing in schools. The results so far have been positive. Schools have received much-needed capital infusions to improve their campuses, equip the classrooms better, and train their faculty to improve standards of education. Students stand to benefit a great deal from all of this new interest.

The renewed investment interest should come as no surprise. In a country of 85 million, the number of students—or potential students—at any given time runs to approximately 20 million from primary to tertiary and graduate-school levels. With education highly valued by families, schools that provide good education at affordable prices will always find a ready market for enrollees. Moreover, given the high demand for certain jobs and skills domestically and overseas (think nurses today, who-knows-what tomorrow), schools that excel in these fields will be the go-to schools for most of the people.

If there’s a fly in the ointment, they lie in the poor quality of education in the public elementary and secondary system, the affordability of tuition rates, and maintaining the overall quality of schools. For instance, for every 100 kids who enter Grade 1 in public schools, only 42 will graduate from high school.

Affordability will be a second issue. Although Filipino families will do anything to send their kids to school, there are limits to their resources. Tragically, those who opted to put savings into educational pre-need plans are now finding that some of those plans are not so financially healthy. Finally, maintaining the quality of schools will also be an issue. Take nursing schools, for instance. In the mad rush to cash in on this rich market, one never knows if the regulators are properly regulating the schools and allowing too many fly-by-nights to open up.

Be that as it may, it is refreshing to see more and more reputable companies enter the educational markets. Our feature story starting on page 12 focuses on how these companies and their schools are working to meet the educational challenges of the country.

GUILLERMO M. LUZ
Publisher & Editor-in-chief