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Private Education Cost Grows Faster Than Income

Posted May. 26, 2008 07:52,   


The recent rise in private education expenditure is putting an increasing pressure on households already suffering from general price hikes.

According to the “Household Income and Expenditure Trends in the First Quarter of 2008” released by the National Statistical Office, the monthly average private education and tutoring expenditure of Korean households stood at 164,700 won during the first three months of this year, up by 15.7 percent from the same period a year before. The share of private education and tutoring expenditure in the total household spending rose to 6.6 percent in the first quarter from 6.0 percent during the same period last year.

Private education and tutoring expenditure have grown by 52.3 percent over the last five years since the first quarter of 2003, far exceeding the growth rates of income (31.8 percent) and consumption (28.6 percent).

Skyrocketing tuition fees of hagwon, or private teaching institutions, are largely to account for the rise in private education expenditure. According to the National Statistical Office`s statistics, the tuition fees for hagwon covering all subjects rose by 7.3 percent and single-subject tuition fees by 6.5 percent compared to the first quarter of last year. The growth far exceeds that of consumer prices recorded at 4.1 percent.

Along with soaring private education costs, low-income households face an increasingly heavy burden from the rise in public education expenditure, which is hardly discretionary.

The monthly average education expenditure of the lowest quintile stood at 131,800 won during the first quarter, up by 27.3 percent from the same period last year. As a result, it posted the highest growth among all quintiles.

Meanwhile, the highest quintile spent an average 307,700 won per month on private education and tutoring during the first quarter, 6.6 times higher than the expenditure of the lowest quintile.

Economics professor Lee Yeong of Hanyang University said, “The demand for private education is on the constant rise as faltering public education fails to respond to the needs of students preparing for college admission, which has become more complex and diversified.” Professor Lee also said, “The government must rationalize public education by introducing a systematic evaluation and performance-oriented rewarding system, and strengthen educational support for children of low-income households.”