Brexit: the biggest challenges for international schools throughout Europe

Having recently spent time in Asia and the Middle East visiting schools and talking with school owners, parents and Principals, Brexit has hardly surfaced as a factor and most had not heard of it. So from an international K12 student perspective coming to Europe are they or their parents worried about Brexit? – it would appear not. The prestige of going to a school in the UK or to a lesser extent Europe remains the aspiration for millions of parents across the world for their Children, especially from Asia. One advantage of the uncertainty caused by Brexit is the drop in the value of the pound which makes UK schools and accommodation far more affordable to foreign parents than it has been.

What may become a concern is not Brexit itself, but one of the key underlying causes of Brexit: the Europe-wide rise of anti-immigration nationalistic parties and the rhetoric and sometimes violence associated with them and their policies. Look at elections in Germany, Sweden, Spain, Italy, Holland, Poland, Hungary to name a few. Although not a concern now, if this spreads it may do two things: make immigrants and therefore foreign students feel unwelcome in key educational cities across Europe, and destabilise Europe politically and therefore economically. If Germany and France fragment politically and Merkel’s decisive leadership is replaced by domestic political infighting this could have serious consequences.

In short, Brexit is not a current issue for the majority of non-European students thinking of applying to a European school. Some of the key underlying causes of Brexit, which many states in mainland Europe are now grappling with, may become a far more serious issue for the reputation and appeal of International Schools across Europe (including the UK).

The likely consequences for international schools in mainland Europe once Britain leaves the EU

A possible increase in international schools in cities such as Paris, Frankfurt, Zurich and Amsterdam as companies leave London. However, this will be a slow process as it takes time to uproot the 100s of families required for this to have any significant effect. In addition, many have cited Brexit as the reason for the sudden establishment of several new schools and extra capacity in Europe and Ireland. Europe had not been an area of investment focus for some time (in comparison to other more emerging markets) for many of the big K12 education investors. What Brexit did was make them look at Europe where some realised that (potentially even without Brexit) there was a lack of supply of school spaces in several key cities in Europe who had long waiting lists, and they have capitalised on this.

In addition there is the potential weakening of the Euro, making European schools cheaper for international students (as we’re seeing in the UK right now). However, this would likely be the result of more global macro effects than just Brexit – the US and Chinese economies would likely dictate this. There is also the risk, considering some of the negative media, that high quality European teachers will leave the UK to teach in European/MENA/Asian schools as they no longer wish to live and work in the UK during this uncertain time. However, much of this is speculative and it is all dependent on what type of Brexit occurs and how. Far more important than Brexit is whether the Conservative party or a Labour party (whose leadership abhor the notion of private education) are in power post Brexit (if it occurs) and for how long.

Influences on the market in Europe that international schools could benefit from

Immigration is having a big impact on the demographics of many of the traditional state schools in Europe, and this change is starting to push wealthy local parents from the state provided schools towards the private sector where they believe their traditional values might be better preserved for their children. However morally wrong or right this may be it is certainly a factor that we have come across in our visits, to particularly Northern European countries over the last year.

Trump’s attitude towards ‘the other’ is putting Chinese students off studying in the USA (he recently said that most Chinese students are spies). Students are therefore more likely to choose Europe as a destination – I’m not sure if this is a EU market macro influence but it may indirectly affect the influx of students from Asia and the Middle East. It is certainly benefiting Canadian schools and universities, as Canada is becoming a more attractive destination.

Investors are seeing the education asset class as inherently defensive so more likely to invest in unstable times (which could be ahead of us…!): there are therefore more opportunities for school operators to capitalise on the capital made available by these investors. Overall, Brexit is an issue, but just one of many, and probably not a barrier for the sector that is likely to be decisive.

By John Forsyth, Forfar Education