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International schools hit by oil & gas crash, says ISC

Uptown School, part of the Taaleem group of schools, Dubai. Photo: ISC Research

"This could be good news for the middle tier international schools with good reputations"

Enrolments will be hit as parents sending their children to international schools employed in professions related to the these industries are made redundant, the group said.

The Middle East in particular is expected to be affected by 1-2% fall in enrolments, according to ISC Research.

“Some have cut back on their staffing for this new year”

Malaysia and Singapore are also likely to feel the brunt of dropping oil & gas prices, with schools that enrol a large proportion of expatriates over locals more likely to be affected, said Richard Gaskell, director for international schools at ISC Research.

“The feedback that we are receiving from many schools is that they have been able to fill these gaps through existing waiting lists,” he said.

“Or they have stepped up their admission marketing, and some have cut back on their staffing for this new year.”

Premium schools are expected to be the most affected, as expatriate families may have to find more affordable alternatives if financial support from employers is reduced.

And companies which have contributed towards tuition fees at international schools could also be cutting back support as a result of the slump.

Last year, the lowest volume of oil was discovered since 1954, at 2.8 billion barrels, according to consulting company, IHS.

Meanwhile, a report from Houston-based consulting firm Graves & Co outlines that there have been more than 350,000 layoffs in the industry globally since the start of the downturn.

Fewer expatriates could free up places for local students, said Gaskell.

“This could be good news for the middle tier international schools with good reputations, and most challenging for the premium schools,” he added.

ISC Research’s latest global report identified a worldwide trend of children from local middle income families increasingly filling seats. The number of international schools worldwide has increased 41.5% in the last five years to 8,257 schools– mostly at the middle to lower end of the tuition price scale.

In Malaysia, Julia Love, director of admissions at the International School Kuala Lumpur, pointed out that despite not experiencing the usual influx of expats from those working in the oil & gas industries, it is “not a dire situation”.

“We must be smart as we know there will continue to be cuts in oil & gas companies,” she said.

“We are fortunate that a number of companies from other industries, mostly high tech, are moving families to Kuala Lumpur and this will ensure that our enrolment is stable for the coming year.”

“Enrolment in international schools has seen rapid growth over recent years”

Other stakeholders in the international schools market share Love’s expectations that growth of other industries, particularly information technology, will counter the decline.

Clive Pierrepoint, director of communications at the Taaleem group of schools in the UAE, said the drop in oil & gas revenues has been levelled out “by an influx of people coming into the country to support initiatives related to Expo2020 and future finance, commerce, travel, tourism and leisure sector growth”.

Meanwhile, Carolyn Savage, head of international education at the Winter’s International School Finder noted that in Singapore, there is growth in finance and the biotech industry and Malaysia, is attracting an increasing number of foreign high-tech and IT professionals.

“Enrolment in international schools has seen rapid growth over recent years, and while the slump in the oil and gas industry will undoubtedly bring about a reduction in student enrolment from within that industry, schools should hold their nerve, because new industries are replacing these just as swiftly,” she said.

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