PESTEL analysis of the education industry

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PESTEL analysis of the education industry

This detailed ‘PESTEL analysis of the education industry’ aims to examine how the global education industry is influenced by several power factors. It explores the industry in different countries, particularly the UK, the USA, Australia, and Canada. Education is a fundamental human right for everyone in the world. However, not everyone has access to education even in the 21st century.

Political factors that impact on the education industry

Education industry is generally divided into three areas i.e. primary, secondary, and higher education. Some countries have excellent institutions across all areas, while others do not unfortunately. It is often very clear that those countries that have very good education systems and infrastructure are politically stable, and the governments provide the institutions with a lot of support.

According to UNESCO (2020) 155 countries guarantee 9 years or more of compulsory education, while 99 countries guarantee at least 12 years of free education. In the UK, the government provides students with a variety of final supports to help them pursue higher education. Likewise, both the federal and the state governments in the USA have grants for students as well (Federal Student Aid, 2021).  However, higher education is expensive in many countries including the USA and the UK.

Countries have national curriculum setting out what students should be taught. Different countries have different requirements for a career in teaching. For instance, in the UK, teachers need to have a PGCE (Post-graduate Certificate in Education) qualification or willing to working towards to work in a primary and secondary school. In Australia, a university qualification is needed to work as a teacher.

Many developed countries have shortage of teachers in subjects such as finance and accounting, maths, engineering, and computer science and recruit qualified teachers from abroad.  However, recruiting teachers from abroad is very difficult for many countries because of their immigration systems.

Economic factors that impact on the education industry

Higher education can be very costly in some countries. Attending a private university costs thousands of dollars per year which many students cannot afford. Even public universities are sometimes very expensive. Students need to take out loans or repayable grants to study there.

Many kids in poor countries cannot go to primary schools because of the cost of transport, and resources such as books or papers. In many countries, teachers are not well paid and therefore, do not stay in the jobs long-time.

Often funds are raised for extra-curricular activities and this may be disrupted if the local economy is in poor conditions. Likewise, local or central governments may cut funding which affects the operations of educational institutes badly.

Social factors that impact on the education industry

Analysing social factors is key in the PESTEL analysis of the education industry. Some parents prefer to send their kids to private schools and universities, while it is beyond the capacity of most of the parents.  It is worth mentioning that though popular, many private institutes lack in resources to offer great quality education.

Suddenly, a large number of people moving into an area puts a huge pressure on local schools and other educational establishments. Conversely, a large number of people leaving an area may result in closures of many schools.

Many schools around the world do not have adequate facilities and resources to cater for the needs of the students with some kind of disability. Likewise, may people do not want to be teachers because of the workload and stress.

Weale (2021) reports that 1 in 3 teachers in England plan to quit the classroom within five years because of reasons such as workload and diminishing respect for the profession. Similarly, many teachers in Australia, Canada, the US, and many other countries quit their jobs in the first two years due to the heavy workload and burnout.

Technological factors that impact on the education industry

Technology is the next component in the PESTEL analysis of the education industry. There is no doubt that technology has dramatically changed the education industry globally. Due to lockdowns, schools, colleges, universities, and other institutes offered education online, especially via Google Classroom, Zoom, and MS Teams. Many also used their own developed solutions. Interestingly, while many industries were closed because of lockdowns, the education industry continued to operate, thanks to technology!

Students have easy access to information and other resources online. However, because of poverty, many parents cannot afford to buy equipment for their kids. Likewise, young children may be at risk being exposed to disturbing materials while surfing online.

Environmental factors that impact on the education industry

The education industry can impact on the environment in different ways. For instance, many institutes use huge amounts of photocopier toner and papers which is not environmentally friendly. Likewise, general waste generated by those organisations, and their use of energy are also problematic. It should be mentioned that natural disasters destroy many educational institutes globally every year.

Legal factors that impact on the education industry

There are different rules and regulations that affect the education industry. For instance, Americans with Disabilities Act (ADA) requires both public and private colleges and universities to make programs accessible to students with disabilities. The UK’s Equality Act 2010 protects students from discriminations. Likewise, there are different regulatory bodies which inspect educational intuitions regularly.

We hope the article ‘PESTEL analysis of the education industry’ has been helpful. You may also like reading PESTEL analysis of the social media industry. Other relevant articles for you are:

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Last update: 12 October 2021

References:

Federal Student Aid (2021) Federal grants are money to help pay for college or career school, available at: https://studentaid.gov/understand-aid/types/grants (accessed 10 October 2021)

UNESCO (2020) What you need to know about the right to education, available at: https://en.unesco.org/news/what-you-need-know-about-right-education (accessed 10 October 2021)

Weale, S. (2021) One in three teachers plan to quit, says National Education Union survey, https://www.theguardian.com/uk-news/2021/apr/08/one-in-three-uk-teachers-plan-to-quit-says-national-education-union-survey (accessed 09 October 2021)

Author: M Rahman

M Rahman writes extensively online with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University.