China’s largest private education company cuts services for youngsters amid tutoring reforms

27-Oct-2021 Intellasia | South China Morning Post | 5:02 AM Print This Post

New Oriental Education, the largest provider of private educational services in China, announced on Monday night it would stop providing extracurricular classes for kindergarten, primary and junior secondary school students by the end of November.

The tutoring company, which offers a wide variety of educational services, is the latest casualty of China’s policy reforms that upended the private tutoring industry.

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The company posted a notice through its subsidiary, Koolearn Technology Holding Limited, on The Stock Exchange of Hong Kong website. It read: “According to new regulations, and to make sure our company and operations abide by all laws and supervisions, the board has decided to stop all academic extracurricular training in the mainland for the compulsory education period.”

The company’s board said terminating its services for kids below senior secondary school would create a short-term negative effect on the company’s profits in the new financial year. It also said the change might help New Oriental in the long-term because that segment of their business had lost money in the past financial year.

“We will keep operating businesses that are not related to basic education and focus our resources on other educational products and services,” the notice said.

Besides primary and secondary school tutoring, New Oriental offers language training, test preparation, online education and overseas study consulting services.

That announcement created a wave of concerns among current tutors and teachers-to-be who worry about their job prospects.

“It’s difficult for those majoring in education to find a different job. We can do nothing but teach,” one said on Weibo.

On July 24, The State Council, China’s top administrative body, dramatically reformed the regulations for the private tutoring industry.

The new rules forced these companies to register as non-profit organisations, banned approvals for new companies and made it illegal for them to receive foreign investment.

It also banned tutoring during weekends, public holidays and school holidays. It applied to all students under senior secondary school age.

The policy change was meant to discourage excessive studying for young Chinese students, who have a notoriously gruelling academic career.

New Oriental is the latest education group to make drastic changes to adapt to the new regulations.

Wall Street English, an Italian company that entered China in 2000, was reported to have gone bankrupt in August. Tech giant ByteDance also closed its education platforms Guagua Long, Qingbei and GoGoKid, and laid off all its staff working for them, according to Bloomberg.

A former New Oriental staff member told the Post that, during the peak days in the 2010s, teachers had to work at least 10 hours a day, sometimes teaching until midnight.

They were evaluated each year by how many students they could retain in their classes who continued to pay for services. She also went to residential communities to actively advertise for the company.

New Oriental announced in August, after the reforms, that it had established a Beijing office to explore different services for students and parents, such as courses for improving emotional intelligence.


Category: China

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