Throughout Korean history, higher education has been synonymous with privilege and power as Korean culture emphasized education. A degree from a well-known institution is a status symbol and an important leveraging tool for finding the right job in the right company. Coveted spaces in Korea’s top schools are open to competition from all students, but are attainable by few. Many talented students opt instead for the best schools overseas. The desire to obtain a diploma from an accredited school overseas has translated to an opportunity for U.S. schools keen to recruit some of Korea’s most talented students.
Korea’s rapid economic development over the past 50 years has led to higher disposable income as well as lower birthrates. Korea has one of the lowest birthrates in the world, with around 1.20 children per family in 2008. Low birthrates have a dramatic effect on education-related industries. Despite the decrease in the number of children, a few factors are still driving high growth rate in the education sector. Following India and China, with more than a billion people each, Korea, with a population of less than 50 million, is the third largest market for U.S. education in terms of the number of foreign students for post secondary education in the United States. The U.S. is the dominant player in university and graduate-level academic study. According to 2008 statistics from the Institute of International Education’s Open Doors report, 69,124 Koreans went to the U.S. for post-secondary study in the 2007/2008 academic year, which represents a 10.8 percent increase over the 2006/2007 academic year.
Korea’s education market plays a significant role in the country’s overall economy. It is characterized by a large demand for overseas education and is highly private sector driven. The demand for foreign education exists in both the private and public sectors of Korea. Thus exceptionally good opportunities exist for the U.S. educational sector. According to the Ministry of Education, Science and Technology, Korea invested more than seven percent of its GDP in educational expenditures in 2008. This investment not only represents a large proportion of the Korean Economy, but it is also one of the largest educational investments by a country in the world.
This important segment of Korea’s economy offers good opportunity for the U.S. educational sector since Koreans are looking to the U.S. as an educational option. With the financial means and frequent overseas travel, Koreans consider overseas study as an option. Parents are concerned that their children will be behind the competition if they do not have an overseas experience. The Korean market also looks promising for corporate programs and educational training in the fields of language courses, business administration, and technical programs because individual success, quality of life and the nation’s overall competitiveness are becoming more important to Koreans and they view these types of programs as a way to achieve these things. Traditionally, education has been an important focus of the Korean government, and it has tried to reduce the gap in educational opportunities as much as possible. The ratio of students continuing on to higher stages of education illustrates the effect of the government’s efforts, along with the general cultural penchant for education. Korea has a higher percentage of college age students enrolled in college than most other countries. More than 83 percent of college age students are enrolled in higher education institutions including two year colleges.
While the skills acquired and knowledge learned during university study are essential to employer evaluations of candidates, the connections and networking opportunities gained in prestigious institutions are arguably of equal importance. Corporate managers tend to look favorably upon job applicants who are alumni of their own universities. Koreans are willing to spend a large portion of their income on education, since they perceive it as an investment that will bring returns.
Current sluggish consumer confidence notwithstanding, Koreans spent an estimated USD 8 billion in 2008 on non-compulsory education that is designed to improve a student’s competitiveness. This includes language training at the ubiquitous “Hagwon”, English-language school, as well as professional training. That puts Korea in the top tier in the rankings among 22 Organization of Economic Co-operation and Development (OECD) member countries in terms of private education spending per capita.
It is expected that Koreans will continue to study overseas. The most important reason for this forecast is that education, particularly in the English language, is critical to success in Korea. To a much greater extent than in the U.S., in Korea, the college a person attends will ultimately shapes that person’s future. A university degree from a well-known American university opens doors to employment in Korea that is largely closed to those who graduate from Korea’s less respected universities. Another reason to study abroad is the perceived weakness of the Korean educational system in teaching English, especially speaking skills. This helps to explain the significant increase in the number of grade-school students studying in Anglophone countries, and the huge amounts of money spent on private ESL institutes. Finally, English language proficiency in the Korean job marketplace is not just important – it is expected. For years, the largest and most prestigious employers in Korea have required TOEFL (Test of English as a Foreign Language) and/or TOEIC (Test of English for International Communication) scores.
By Alex Choi