Tim McDonald, headmaster of the International Academy of Beijing (IAB), has seen enrollment figures grow during his tenure. But the financial crisis is biting into his numbers. "We've lost students for the first time in the five years I've been here," McDonald says.
IAB is not alone. Many of Beijing's international schools are facing an uncertain future as families are forced to leave China or move their children to less expensive schools.
To make matters worse, some administrators believe the biggest losses still lie ahead as families wait to move in between yearly enrollment periods.
One report in the Financial Times quoted an unnamed parent with children enrolled "in an expensive Beijing international school" who said that most of her daughter's Korean classmates left almost overnight.
Although the reality on the ground is more nuanced than what the report suggests, it's no mystery that Beijing's Korean population has been hit hard by the financial crisis and that this has hurt Beijing's international schools.
"The largest group of students who've left are Korean," explains Reg Bonnell, principal of Beijing's Canadian International School (CIS), where Koreans normally make up nearly 40 percent of the student body.
"They're getting a double whammy in currency devaluation and the general economic hit."
Ironically, the crisis may actually be a boon to Beijing's Chinese and Korean Schools, which have attracted some Korean families because they cost less than other international schools.
Many companies looking to trim costs have been cutting or even eliminating provisions for school fees in their contracts.
As a result, some expat parents in Beijing are being forced to cover tuition out of their own pockets.
To keep families, Beijing's schools are implementing everything from staff freezes to aggressive ad campaigns.
To deal with struggling families, the Western Academy of Beijing (WAB) has already started offering payment plans with installments and extensions.
The downturn also has some schools considering tuition relief in the future.
"Possible cutbacks in the future are absolutely in the minds of the board," says Sinead Collins, WAB communications director.
Yet despite reports of a Korean exodus, not all schools have lost students. Beijing's CIS, for instance, saw an unusually large flight of students at the semester, but the flight was then followed by an even larger new group of enrolling students. "Our numbers are actually slightly higher than before," says Bonnell.
Larger and more established schools are faring better.
Schools like the International school of Beijing (ISB), for example, have long had more applicants than available enrollment space.
The downturn means some families may be taking the opportunity to move from smaller, less-established schools to large schools that now have more space.
"We actually increased our enrollment at the January transition," reports Mark Hillman, director of communications for ISB.
Established schools may also be better able to handle significant downturns. "We're fairly confident that we can handle, in the short term, a downturn of as much as 30 percent," Hillman says.
Yet a surplus in enrollment hasn't shielded schools from concerns about the high cost of Beijing's international schools at a time when salaries are falling.
Tuition and fees for high school students at schools like ISB and WAB run to nearly 200,000 yuan ($26,400) per year.
"There aren't any outside funding sources to support the school," Hillman says, explaining school fees. "All of the materials, debt, financing, building, and improvements are our direct costs."
School fees may also be higher because schools such as ISB are non-profit and parent-run, holding education concerns above lowering cost.
"We could increase class size and lower our costs, but the school board believes that lowers the quality of education for the students," says Hillman.
International schools also have the added expense of catering to a diverse population, says Collins of WAB.
"We need ESL programs, learning disability programs, gifted programs, mother-tongue language programs it's not a straightforward, one-size-fits-all model," she says.
Even large schools that haven't lost students are looking ahead nervously at the upcoming enrollment period, which many administrators say will be the true test of the crisis.
Bonnell predicts CIS will finally see enrollment numbers fall in the coming school year:
"We are forecasting that in September our numbers will be down, and that's a direct result of the economic situation."
At WAB, declines are predicted for farther down the road.
"We predict for the 2010-11 school year that we'll have a decline in enrollment," Collins says.
The one certainty of the crisis seems to be the uncertainty about just how bad it will be.
Predictions are particularly difficult this year because families are facing uncertainty about new contracts and possible cuts. As a result, WAB has had trouble surveying families about enrollment for the coming year.
"Normally, 90 percent of people would have responded to the survey at this point," says Collins. "This year, right now it's 65 percent.
Even as some schools cut their budgets, other schools are actually using the downturn to expand their facilities and bank on the steady enrollment growth of recent years.
"Property values are lower now than they were, and they continue to decline, so this might be a good time for expansion," says McDonald of IAB.
Expanding during a downturn may be a result of the confidence of most administrators interviewed that the particulars of Beijing's economy may shield them from the full brunt of the global crisis.
"One advantage we do have in Beijing is that we have a significant pool of students from diplomatic families, which are relatively stable," McDonald explains.
Companies too are reluctant to pull out of the developing Chinese market.
"A lot of companies already have projects funded here so they're not going anywhere. For a lot of companies, China's where they're making money," says McDonald.
For now, though, Beijing's international schools are preparing in case the other shoe drops. "Right now, nobody knows for sure what to expect."
(China Daily April 13, 2009)
