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Educational Services

Educational Services

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Executive summary

The Educational Services sector comprises 13 subsectors of the US economy, ranging between public schools, testing and educational support operators. Many services provided by operators are staples, such as primary and secondary education, whereas others are more discretionary, such as business coaching and tutoring services.
Operators in public schools, private schools, community colleges, nonprofit universities and colleges and for-profit universities generate just less than 95.0% of sector revenue. As a result, the sector has benefited from increases in government funding for primary and secondary education and funding for universities, since the primary source of revenue comes from government funding at the local, state and federal level. Furthermore, operators have benefited from increases in per capita disposable income and an increasing number of households earning over $ 100,000 annually over the five years to 2022. Due to these increases, consumers have become more willing to pay for private education and discretionary educational programs.
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industry margin;

industry employment;

industry major players;

industry key external drivers;

industry product & structure segmentation;

industry key trends;

industry Life Cycle;

industry Geographic Breakdown;

industry Key Success Factors;

industry Key statistics for previous years;

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Reference Wordlist

High barriers to entry mean that new companies struggle to enter an industry, while low barriers mean it is easy for new companies to enter an industry.

Compares the amount of money spent on capital (plant, machinery and equipment) with that spent on labor.
IBISWorld uses the ratio of depreciation to wages as a proxy for capital intensity. High capital intensity is more than $ 0.333 of capital to $ 1 of labor; medium is $ 0.125 to $ 0.333 of capital to $ 1 of labor; low is less than $ 0.125 of capital for every $ 1 of labor.

The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation using the current year (i.e. year published) as the base year. This removes the impact of changes in the purchasing power of the dollar, leaving only the "real" growth or decline in industry metrics. The inflation adjustments in IBISWorld’s reports are made using the US Bureau of Economic Analysis’ implicit GDP price deflator.

Spending on industry goods and services within the United States, regardless of their country of origin. It is derived by adding imports to industry revenue, and then subtracting exports.

Colloquial Terminology

An independent public school designed by educators, parents, community leaders, educational entrepreneurs and others that want to provide quality education tailored to students' needs.

Applies to nonprofit schools. Refers to total budget minus pension and debt service costs.

A primary or secondary school supported by a religious organization.

Discipline that encompasses the theory and practice of teaching and how these factors influence learning.


However, these trends have reversed since the COVID-19 (coronavirus) pandemic hit. Amid the outbreak, the Consumer Confidence Index dropped and the unemployment rate skyrocketed, limiting discretionary spending. This mainly affects the small subsectors, such as sports coaching and language instruction, as they are more discretionary than primary, secondary and postsecondary education. As the pandemic subsides and a large share of the population is vaccinated, including children, sector revenue has recovered gradually. Therefore, sector revenue is expected to increase an annualized 2.1% to $1.8 trillion over the five years to 2022. However, declines in the high school retention rate and household income levels are expected to depress sector revenue, with sector revenue falling 0.2% in 2022 alone. In 2022, profit, measured as earnings before interest and taxes, is anticipated to account for 6.8% of sector revenue.

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