International school tuition fees continue to rise following a pattern established over the last few years. ECA’s global average tuition cost for the 2017/2018 academic year has increased to USD 16 013, a 4.2% rise on last year.
ECA’s Managing Mobility Survey found that more than half of participants felt education was an integral part of assignment success. The survey went further, showing how 35% of failures to adapt are due to problems with children’s education. The provision of this benefit is a crucial step in adapting children to a host country and it’s easy to see why, according to ECA’s Benefits for International Assignments Survey, 80% of organisations assist with education costs for assignees’ children.
ECA’s benefits survey also showed that at least 80% of respondents thought the standard of host country schools, language of tuition and difficulty of reintegrating students back in the home system were ‘important’ or ‘very important’ factors in choosing schools. One of the issues when planning assignments is that many nations’ local state education systems are not up to expected standards so only international schools will fit these criteria.
Low supply and high demand
With more companies accessing new developing markets, international schools have been trying to keep up with demand and cater for the modern-day expat. However, although previously most of the demand for places came from expats, some is now coming from the growing middle classes of host countries. The reason for this is most international schools offer English curriculums and local families see them as a step towards prestigious Western universities. When a product has a limited supply but high demand, prices will increase.
Thousands of international schools exist globally to meet this demand, and some countries have even made policy to limit the number of locals going to these schools. For example, in 2009 Hong Kong’s Education Bureau (EDB) lowered the ratio of local students allowed in international schools to 30% of total enrolment. This would in theory increase the number of places for expat families and lower the pressure on prices. These types of reforms in local state education and systems limiting the demand from locals may help the situation for expats but otherwise there is no end in sight to rising fees. The EDB has so far not taken any action on schools which have exceeded the ratio of local students.
Top (and bottom) of the charts
After our most recent survey of international schools we found that once again China was the most expensive country in the world for secondary school tuition, with an average annual country cost of USD 41 936 - an 8% rise from last year.
Fees across the world have tended to rise even if the economy of the host country is not performing well. This shows that the market can be resistant to changes as education is in constant demand. Countries like the UK, where a shock Brexit vote led to inflation and a weakened pound (GBP), have a guaranteed demand from international and local families to counteract these problems. This allowed for a constant growth in its annual secondary tuition of 1% in dollar terms (USD) and 4% in sterling terms (GBP).
Switzerland, USA, UK and France make up other ranks in our top ten and are home to qualifications such as the IGCSE, International High School Diploma, International Baccalaureate, and the French Baccalaureate. Schools that offer this type of qualification tend to charge higher prices because they are internationally recognised and easily transferable between countries. Angola and Nigeria remain in our top ten ranking because their security issues inflate the price of tuition. Also, despite having large expat populations, a lack of schools in these nations mean higher competition for places and higher prices.
Mongolia has dropped from 5th to 7th in our ranking with exchange rates being the main cause. Despite a local currency increase of 9% in its annual secondary tuition fees this translated into a 1% increase in USD terms. Currency movements have also affected the Eurozone countries in our ranking. The euro has been steadily rising against the USD throughout 2017, pushing Belgium and France up the rankings, as well as others. Furthermore, looking at regional averages, Europe has seen the largest increase in annual secondary tuition with an average 7% increase.
Our bottom five ranked countries are unchanged due to their relatively underdeveloped international school markets. Burundi is still rooted to the bottom of our ranking, with an annual secondary tuition fee of USD 3 291 which has slightly risen to 21% of our global mean, compared to 17% in 2017. Many South and Central American countries make up the rest of the ranking and suffer from low expat populations and weak local currencies.
Two of our biggest drops in ranking came from the Philippines and - Japan has dropped 15 places to fall out of our top 50 while Philippines has dropped 14 places to 112th.
Sweden has risen eight places into our top 100 at 98th in our ranking but retains one of the cheapest international school tuitions in Europe. Its average annual secondary fee is USD 16 804 which is still USD 791 above our global mean.
Additional fees and considerations
Something else to consider for international schools is that they will normally charge higher fees the older the child gets. The biggest jumps can be seen when the child transitions from kindergarten to primary school or from primary to secondary school. From our data you can see that on average fees increase 47% from kindergarten to secondary school, with a 23% increase from kindergarten to primary and 20% increase from primary to secondary. The biggest jump is seen in the Australasia and Pacific region with secondary 75% more expensive than kindergarten. Furthermore, some families may have more than one child, therefore doubling or trebling the costs of this benefit, although some schools do offer sibling discounts.
As well as tuition fees, many schools charge compulsory extra fees, from common extras like application and registration fees, uniforms, and exam fees to slightly less common debenture and education bonds. Normally fees like debentures are charged at the beginning of a child’s school career and returned once they graduate. However, these fees can surpass the annual tuition of the child and are increasing at similar rates. The need for more cost-effective assignments has meant global mobility managers increasingly looking for ways to cut these costs down.
Percentage of companies covering additional education costs
© Employment Conditions Abroad 2018
Some countries like the USA and UK offer free high-quality state schools that provide international qualifications. In our benefits survey 30% of our respondents required their assignees to use state schools wherever possible to cut costs. However, barriers to this possibility include strict criteria for admitting a foreign student and potentially different languages spoken in the host and home countries. The language issue shows in our survey results; using a state school is a requirement for only 17% of companies with an Asian HQ but 58% of companies with an Australasian HQ.
With education continuing to be an important and expensive part of international assignments, global mobility managers must consider inevitable fee increases as well as the extra costs when budgeting future international assignments.
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ECA’s Benefits Reports contain listings of tuition and other fees for international schools in 162 countries, so you can budget fully for this important assignee benefit. ECA conducted research on 2,666 schools around the world during 2017/2018 to bring ECA subscribers the latest figures.