Soaring Education Costs
From the Korea Time’s Opinion section on Monday, May 7, 2007
Radical Steps Need to Reduce Private Tutoring
Soaring education spending has emerged as one of the major reasons for married women to avoid childbirth, pushing South Korea to rapidly become an aged society. Specifically, private tutoring costs are putting strong pressure on couples to go without children. According to the National Statistical Office (NSO) on Friday, consumer prices rose at a relatively stabilized rate of 2.5 percent last month compared with a year before. However, households’ education-related spending jumped between 5 percent and 9 percent, far higher than overall price hikes.
It is not surprising for parents to complain that they are scared to raise children due to the heavier financial burden for education. But, this does not necessarily mean that policymakers can overlook such a complaint, as the country has now recorded the worlds’ lowest birthrate of 1.08. An increasing number of young people prefer to remain single rather than get married due to difficulties in getting jobs and skyrocketing housing costs.
Newly married couples usually suffer from the backbreaking burdens of childbearing and education. In particular, more and more women tend to focus more on their career than childbearing, adding fuel to the low birthrate trend. The NSO statistics showed that the costs for daycare centers climbed 9.2 percent in April from a year earlier, while babysitter fees jumped 7.7 percent. Tuition for kindergartens also surged 9.5 percent.
What’s worrisome is that parents are not able to save money for their retirement since they have to spend excessively on the education of their children. According to the Hyundai Research Institute, parents were found to spend 19 percent of their monthly income on private tutoring for their children. The private think tank affiliated with the Hyundai Group said each household sets aside an average of 646,000 won for private tutoring, or 381,700 won per child. What’s astonishing is that the total volume of South Korea’s private tutoring market is estimated at 33.5 trillion won, accounting for 3.95 percent of the nation’s gross domestic product (GDP). The sum exceeds the government’s entire education budget of 31 trillion won. The burden is much higher than that of other countries belonging to the Organization for Economic Cooperation and Development (OECD).
In the end, the huge education costs have a negative effect on the economy, not only forcing households to cut down both consumption and savings, but also accelerating the “double-income, no kids’’ phenomenon. This problem will inevitably make a dent on South Korea’s international competitiveness in the foreseeable future.
Policymakers must produce radical measures to normalize school education and introduce a new college entrance system in a bid to reduce private tutoring costs. They also ought to take long-term steps to encourage marriages and childbirths. May is called the Month of the Family in South Korea with Children’s Day, Parents’ Day and Teachers’ Day. We need to redouble our efforts to restore the value of having a family.