Private education inflation in Korea outpaces CPI by wide margin

Signboards of private cram schools are displayed in Gangnam District, southern Seoul on Tuesday. [YONHAP]

Koreans are spending more on private education.

Total expenditure on private education for Korean students was 26 trillion won ($20 billion) last year, up 10.8 percent, according to a report released by Korean Statistical Information Service (Kosis) on Tuesday. The rise is double last year’s 5.1 percent inflation.

Korean expenditures on private education for elementary, middle and high school students totaled 26 trillion won ($20 billion) last year, up 10.8 percent on year, according to a recent report by Korean Statistical Information Service (Kosis). That's about twice the consumer price increase of 5.1 percent over the same period.

The statistics agency surveyed about 3,000 schools and 74,000 people in the March-May and July-September last year.

Private education refers to all educational services received outside of the regular school curriculum, including tutoring and hagwons, or private cram schools.

Koreans on average spent 410,000 won per month on their children’s private education, an 11.8 percent increase on year. The average also includes students who do not receive private education at all in the calculation as well. If these students are taken out of the equation, the monthly private education expense climbs to 524,000 won.

Kim, a mother of a third-grader son, moves her child to a different hagwon, each time her income rises.

The series of “upgrades” to hagwon with a higher reputation increased her private education spending by some 1 million won ($770) per month.

“Once you begin to have your kid take private lessons, there is no going back,” she said, adding the increase in private education expense outpaces the increase in her and her husband’s income.

Elementary school students had the highest participation in private education, at 85.2 percent, followed by middle school students, at 76.2 percent, and high schoolers, at 66.0 percent. The total participation increased between surveys with 75.5 percent receiving private lessons in spring and 78.3 in summer.

People’s distrust in public education and private education companies marketing on the fear of falling behind may have accounted for the rising dependency on private education.

“The expenditure and participation in private education reached an all-time high since the data compilation began in 2007,” said Park Eun-young, director of welfare statistics at Statistics Korea. “Both have steadily grown, except in 2020 when hagwon closed because of the pandemic.”

People had to spend more as their children grow older. Parents of grade school students spent 372,000 won per month, whereas parents of middle schoolers spent 438,000 and high schoolers 460,000. All parents had to pay some 10 percent more than they did the year before.

People on average paid the most for English lessons, at 123,000 won, trailed by math, at 116,000, and Korean, at 34,000. But secondary school students paid more for math classes.

The household income was directly proportionate to the expenditure and participation in private education.

Households that earned more than 8 million won a month spent 648,000 won in private education and those that earned less than 3 million spent 178,000. The former also had the highest participation, at 88.1 percent and the latter had the lowest, at 57.2 percent.

Some links were found between actual grades and private classes, although it was a chicken-or-the-egg situation.

Of those who earned grades in the top 10th percentile, 77.5 percent had private lessons and paid 590,000 won a month, while 54 percent of those in the bottom quintile took private lessons and paid 323,000.

Families who lived in Seoul paid 937,000 won per month, trailed by those in Gyeonggi, 727,000 won, and Daegu, 704,000 won.

Meanwhile, one out of four parents surveyed by the Korean Educational Development Institute in 2021 believes the best way to reduce spending on private education was to associate the College Scholastic Ability Test (CSAT) with EBS. This measure involves deriving the college entrance exam from lectures taught by EBS, the one and only public educational broadcaster.

The government also agreed with this idea. It said the CSAT-EBS connection that thinned during the Moon Jae-in administration needs to be improved and after-school programs in primary schools need to improve, in a report released by the National Assembly Research Service last year.

BY KIM KI-HWAN [sohn.dongjoo@joongang.co.kr]