'Education fever' among young parents drives spending surge: BC Card

Shoppers look at math workbooks displayed at a bookstore in Seoul on Dec. 27, 2023. [YONHAP]

Card spending on private education surged steeply over the past three years, driven by growing "education fever” among young parents.

According to the latest data from the BC Institute of Innovative Finance, the number of BC Card users in their 30s paying for private cram schools, or hagwon in Korean, surged by 130.1 percent last year compared to 2020.

With the average age of women giving birth to their first child standing at 33.5 per Statistics Korea's 2022 data, the significant increase in education expenditures for those in their 30s signifies a growing enthusiasm for early childhood education for children under the age of 8.

At the same time, the number of BC Card users paying for private arts and sports education increased by 76.6 percent from 2020. Those subscribing for worksheet services providing studying materials for home-based education saw a 92.7 percent jump during the same period.

“My kid doesn’t like being in the daycare center all day long, so I wanted to let them experience various studying programs before attending elementary school,” said a young parent surnamed Hwang, who is raising a 7-year-old.

The amount of spending per consumer is growing every year as well.

Outlay on hagwon for basic academics rose 65.5 percent since 2020, while expenditure on arts and sports education increased 65.5 percent. The amount of spending on worksheet services also nearly doubled by 90.9 percent.

Meanwhile, the amount of spending on kindergartens increased 49.9 percent, whereas total transactions decreased by 6.4 percent, suggesting that while the number of consumers is decreasing due to Korea’s ever-plunging birthrate, the actual amount of money spent on each child has grown significantly. Kindergartens are also rolling out additional education programs focusing on the English language or arts and sports, driving demand for younger parents.

The number of consumers in their 30s spending on foreign language education services climbed 90.1 percent over the past three years, a figure that includes expenditures for both themselves and children. The amount of spending jumped 85.2 percent.

During the same period, the number of English kindergartens nationwide increased from 724 in 2020 to 842. The average tuition fee for an English kindergarten in Seoul stands around 2 to 3 million won ($1,475 to $2,212) per month.

High education costs in Korea are considered one of the driving factors behind the country's claim to the lowest birthrate in the world. According to a survey by the Korea Population, Health and Welfare Association published in March, 96 percent of respondents agreed that “the cost of raising a child is heavy.”

"We need to discuss ways to diversify extracurricular activities within public education,” said Kim Eun-yeong, a researcher at the Korea Institute of Child Care and Education.

BY OH HYO-JEONG [shin.hanee@joongang.co.kr]