2023 Education Market Expectations

HolonIQ’s Annual Education Market Expectations survey gathers data and perspectives from our Global Panel on the state of the global education market. This year’s results and respondent comments show that organizations are facing financial and political uncertainty, technology challenges and talent shortages.

Key market trends and issues for organizations ranged widely depending on geography, sector and organizational context, but several themes emerged across the board. Global and regional economic uncertainty is putting pressure on established organizations, EdTech companies and educational institutions, with restrictions on the availability of capital and budgets for growth and innovation.

Technology was also identified as a significant issue, particularly the continued mandate for digital adoption and transformation initiatives and ongoing evolution of diverse learning design and delivery modes, especially for Higher Education institutions. Advanced technologies are also considered an important trend, with the possibilities and challenges of AI top of mind. Related to many of these trends is the broad issue of talent acquisition, retention, and development. New skills are needed, but the labor market is tight and the workforce is still recovering and reflecting on an extended period of disruption.

The full briefing covers

Market Conditions
Demand Expectations
Growth Strategy
Workforce Changes
Disruption

Market Conditions

Education market conditions have been challenging, with the situation broadly expected to stay the same, or improve a little over the coming year.

Overall, the impact of challenging world and regional events on the global education market has been felt significantly, particularly in the second half of the year. 30% felt that market conditions in their country were moderately worse and 28% felt they were the same compared to 6 months ago. There was some positivity from 24% of respondents, however, who perceived market conditions to be moderately better now.

Looking ahead to the next 6 months, sentiment is mixed but tending somewhat optimistic, with 34% expecting the situation to remain the same, and 28% forecasting moderate improvement. Still, one quarter of our respondents are expecting the situation to deteriorate within the coming 6 months.

Comments from this year's cohort show a spectrum of different experiences, with both opportunities and risks on the horizon. Sectors where conditions are felt to be worse or the same as 6 months ago include Corporate Training and Lifelong Learning in particular, but along with increased interest from governments and industry in upskilling and reskilling, both of these are expecting moderately better or similar market conditions in the coming year. The Higher Education sector is more mixed in outlook, with over 40% still expecting worse conditions to come.

Analysis by sub-sector again shows a marginal shift to positive expectations for the next 6 months, particularly in Tutoring/ Test Prep, Language Learning and Workforce/ Talent. There is more caution in Testing & Assessment, which is to be expected with recent intense focus on the threats and opportunities posed by Artificial Intelligence solutions.

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Growth Strategy

Strategic priorities broadly focus on growing existing markets, with some looking to grow in new markets. The overall trend in strategy is a focus on stabilization and consolidation for the coming year, with less innovation anticipated in product/service offerings, technology or operations.

36% put growth in existing markets at the top of their priorities, and a further 22% identify growth into new market segments as a key priority. Further down the list comes expanded and/or new offerings (18%), operational improvement (13%) or a shift to new technologies (10%), reflecting more cautious attitudes, but also a need to focus on ROI in a period of financial constraint and uncertainty.

Analysis by sector shows Pre K, Vocational and Corporate Training most focussed on existing markets, in some cases responding to emerging skills needs and new sources of national or regional funding to meet skills gaps. A more varied strategic approach is emerging from Higher Education and Lifelong Learning sectors, where different learning models, shifting learner demographics and the impact of new technologies present different opportunities and demand for innovation.

Regionally, we see South Asia and North America, which have attracted significant Venture Capital, now focussing on operational improvement more than other markets, looking at increased efficiencies and potentially cost-cutting measures in challenging economic circumstances. Most regions are targeting existing markets and looking to consolidate locally, but South Asia, Oceania, MENA and Sub-Saharan Africa also have their eyes on new product innovation, with SE Asia and Africa looking to new technologies in particular.