We’ve all heard the phrases ‘tightening belts’ and ‘reducing discretionary spending’ more often than ever before in recent times. A new thought paper by tatu takes a look at the recent economic changes and examines the projected impact of the Covid-19 crisis on enrolment for Australia’s non-government schools.

Unprecedented is the word of the day but we do have a close parallel in the Global Financial Crisis. Australia was one of few countries to experience growth during the GFC, however in the United States the story was very different. In the four years it took for the economy to recover, private schools lost a full 15% of their student population to the public system.

Will that happen now in Australia? It is all a matter of human behaviour. Consumers tend to react in recognisable patterns during recessions and we can borrow from the post GFC work of Harvard professors and others to examine what will have the most effect on non-government school registrations and recruitment for the foreseeable future. Depending on the length of economic uncertainty created via Covid-19, the strained budgets of one particular parent cohort could prove to be the proverbial sting in the tail for a certain category of schools.

Smart schools should be looking to leverage any existing competitive advantages

If we look past the headlines at the real factors that impact consumer decisions, we get a cluster of key economic indicators we simply can’t ignore – unemployment, real wage growth, inflation, consumer confidence and household loan defaults. Right now, in Australia, the average household is hurting and that creates great uncertainty. But will it change the spending habits of the private school consumer?

The paper identifies some strategies to maximise opportunity for schools. How will your enrolments be affected when the COVID-19 recession bites? What will influence future parents in their school choice decision? What about discounts? How long until we see ‘a new normal’? What action should you take now?

For a deeper look into the tatu research and to gain access to the full paper, contact John or Sharee at tatu on (08) 8373 6011.