Preschool is the smallest industry in the education division, earning an estimated 1.6% of total revenue. In the past five years, the preschool education industry contracted as the move towards integrated childcare and preschool education caused a decline in separate session preschool services. Wages also declined over this time.
However, ongoing public debate about the role of preschool education will see these trends reverse in the next five years. Early childhood education was highlighted in the 2008-09 federal budget, with $533.5 million allocated over five years to provide universal access to preschool for 15 hours a week over 40 weeks a year. Other efforts to improve preschool education include dedicated training funds of $126 million and $2.5 million for curriculum development. This is anticipated to boost take-up rates of preschool education in the future.
Schools account for an estimated 56.8% of education division revenue. Within this sector, government schools account for about 35.1% of revenue, and private schools constitute the remainder. Over the five years through 2012-13, private schools are expected to continue outperforming private schools. Private schools are expected to expand their revenue by an estimated 1.8% per annum, compared with 0.9% annual growth for public schools in the five years through 2012-13. Even the economic downturn did not slow private school expansion.
Despite fears of a switch away from private schools in tougher times, enrolment figures for 2009 reveal that enrolments rose 1.4%, well above growth in public school enrolments, which increased 0.4%. However, private school enrolment growth has slowed from a high of 2.47% in 2007, suggesting external limitations are preventing higher take-up rates of private education.
The post school education sector currently accounts for about 34.8% of division revenue, up from the 25.6% of a decade ago. Universities and other higher education providers account for an estimated 77.3% of post school education revenue, and represent about 30% of total education division revenue. Technical and further education constitutes a smaller share of total education revenue, just over 9.0%. These proportions have held steady over the past five years.
The remaining education services account for an estimated 6.8% of total education revenue, falling from 8.6% five years ago. The segment is dominated by ELICOS and tutoring businesses, which have experienced strong demand in the five years through 2008-09. However, the high Australian dollar and the racially motivated attacks on international students have discouraged international enrolments. Thus, of all education industries, this industry has recorded the worst performance over the past five years.
The education division will continue to be influenced by state and federal government policy for funding and education, changes in the school-age population, and the retention rates of secondary students. Over the five years through 2017-18, education division revenue is forecast to expand at an annualised 3.3% to total $120 billion.
In 2013-14 the industry is forecast to grow by 3.2%. Government efforts to boost the number of graduates by 2025 are expected to translate in higher enrolments in the higher education sector. Additionally, an unexpected increase in the birth rate from 2001 will boost demand for education, as this age group progresses through primary education and then to higher levels. The secondary school retention rate will likely remain steady and trending upwards, as it has for the past five years. Apparent retention rate was estimated to be at 78% in 2010 according to the Australian Bureau of Statistics, suggesting optimistic prospects for post school education in the future.
Government funding for the school education sector, however, is uncertain. As at July 2012, the state and the federal governments had yet to reach an agreement on a new funding model for the 2013 school year. If the government implements the Gonski Review in full however, the industry expects an extra $5.0 billion to flow into the sector. Although the final figures for federal funding for schools cannot be ascertained, state and territory funding of schools is forecast to grow 3.1% per annum over the five years through 2017-18.
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