Schools and Educational Services, NEC

SIC 8299

Industry report:

This classification covers establishments primarily engaged in offering educational courses and services not elsewhere classified. Included in this industry are music schools, drama schools, language schools, short-term examination preparatory schools, student exchange programs, curriculum development, and vocational counseling, except rehabilitation counseling. Establishments primarily engaged in operating dance schools are classified in SIC 7911: Dance Studios, Schools, and Halls; and those providing rehabilitation counseling are classified in SIC 8331: Job Training and Vocational Rehabilitation Services.

Industry Snapshot

Somewhere between traditional education at colleges or universities and adult enrichment classes at the local high school, there lies a vast array of schools, programs, and educational services intended to educate students in areas and programs that other schools do not offer. Specialty schools and classes, often turning interests into careers, enjoyed a steady following into the early 2010s. In the periphery was a broad stratum of support services, all intended to assist the prospective student with informational, directional, or financial resources. The industry is segmented into three broad groupings: enrichment and avocational instruction, career development programs, and educational services.

Organization and Structure

The enrichment and avocational group is the largest in the industry. It encompasses such institutions as art, ceramics, and cooking schools; baton, drama, and music schools; charm, diction, finishing, modeling, personal development, public speaking, and speed-reading schools; and schools for those who want to learn to drive an automobile, fly an airplane, study the Bible, speak foreign languages, or survive in the wilderness. The depth of instruction varies and may range from appreciation of a subject all the way to mastery of that subject.

Career development programs include continuing education programs and civil service schools. Continuing education programs provide students with opportunities to learn or improve job and professional skills through participation in seminars and workshops. Civil service schools prepare students to complete the examinations required for employment in government positions. Other preparatory schools offer courses intended to enhance a prospective student's chances of being accepted into graduate or postgraduate schools.

Educational services organizations develop educational curricula, offer tutoring, or provide vocational counseling. Some also operate student exchange programs or provide other networking resources to facilitate a correct match between student and school.

Background and Development

Interest in private specialty schools was strong in the 1990s. In 1997, U.S. News & World Report ranked leading music, drama, and fine arts (among other specialty) schools in the nation. Competing against their university counterparts, The Julliard School (New York), the Curtis Institute of Music (Pennsylvania), and the New England Conservatory of Music (Massachusetts), were three among the top six schools of music nationally. Independent drama schools also ranked successfully against competing universities offering comparable programs. In the late 1990s, New York City drama schools had an unusually high number of applicants..

Dun and Bradstreet reported that in 2008 the 58,113 establishments operating in this category of the education industry employed 466,198 workers. California had the largest number of employees in the industry, with 60,569, followed by New York with 39,273 and Texas with 28,051. California also led in terms of overall revenues, garnering $2.6 billion of the $19.4 billion in total sales. New York reported $1.7 billion and Florida approximately $1.1 billion.

Current Conditions

Of the many different categories under this classification, three of the largest were flight schools, language schools, and tutoring.

Flight Schools.
Flight schools in the United States suffered economically after the terrorist attacks of September 11, 2001, because some of the terrorists learned to fly at such institutions. By the mid-2000s, the Transportation Security Administration had improved security clearance requirements to speed up the applications of non-U.S. nationals for flight training courses. The new policy allowed students to have their fingerprints taken by approved agencies in their home country rather than in the United States. During the mid- to late years of the first decade of the 2000s, enrollment in flight schools dropped dramatically while insurance rates shifted upward, but demand for trained pilots continued to increase. In 2010, the U.S. Census Bureau reported 921 flight training schools, which together employed 14,517 people.

Language Schools.
Of all the specialized instructional institutions, language schools were among the fastest growing. In the early 2010s, Berlitz International, a subsidiary of Benesse Corp. and based in Princeton, New Jersey, led the field in teaching foreign languages to business executives and travelers around the world in 550 centers in more than 70 countries. The company's enrollment increased significantly as corporations recognized the importance of foreign language skills when competing in global markets. By the late 2000s, Berlitz had expanded its services to include online courses and cultural awareness classes, and in 2011 it reported revenues of about $392 million with approximately 5,600 employees.

The move toward online learning was greatly affecting language education as well as other sectors of the industry. For example, in April 2010, Innovative Language Learning LLC, an Internet-based language school, passed the 100 million mark for number of language lessons that had been downloaded from its website. More website-based language schools continued to crop up into the 2010s

In the early twenty-first century, schools and parents in the United States were increasingly looking to tutoring to improve student performance at the kindergarten through 12th-grade levels. According to a survey by Sutton Trust, an education charity, 22 percent of parents with 11- to 16-year-olds in state schools had paid for tutoring at some time. This represented an increase from the 2005 figure of 18 percent. The Economist reported that tutoring was beginning earlier and that part of the rise in demand was due to the increasing competition for acceptance into the nation's most prestigious universities. In addition, although many establishments provided tutoring--and tutoring was listed as one of the top franchising opportunities for 2012 in Entrepreneur magazine--the industry also employed many individuals who worked out of their home. Three of the largest tutoring service companies in the early 2010s were Educate Inc., The Princeton Review Inc., and Kaplan, Inc. Educate Inc. of Baltimore, Maryland, provided services to more than 250,000 kindergarten through 12th-grade students using the Sylvan, Schulerhilfe, Catapult Learning, and eSylvan brand names. Sylvan Learning Centers offered instruction in reading, math, writing, study skills, and test preparation. These North American learning centers included franchised and company-owned establishments. Catapult Learning previously operated as Sylvan Education Solutions and provided supplemental instruction at schools, school districts, and other educational organizations. ESylvan provided online tutoring programs, and Schulerhilfe was the company's European learning center business. Revenues for Educate Inc. reached $545.8 million in 2011 with 10,161 employees.

The Princeton Review Inc. of Framingham, MA, was the nation's number-one provider of prep courses for the Scholastic Aptitude Test (SAT), in addition to offering courses for other admissions tests such as the American College Test (ACT), Graduate Management Admission Test (GMAT), Law School Admission Test (LSAT), Graduate Record Examination(GRE), and Test of English as a Foreign Language (TOEFL). In 2012 the company spun off from its parent company and went private, with an official name of TPR Education, LLC, but it continued to operate under the Princeton Review name. Sales in 2011 were $188.7 million.

In addition to offering online degrees through Kaplan University, Kaplan Inc. of New York, a Washington Post subsidiary, published resources for students preparing for such tests as the SAT, LSAT, GRE, and Medical College Admission Test (MCAT). The company also offered professional development and compliance training for those in the financial services, real estate, and information technology industries. With 12,000 employees in 2011, annual sales for all divisions of Kaplan were $2.4 billion.

Other Educational Services and Schools.
Leading companies offering enrichment and avocational classes in the early 2010s included the Braille Institute of America Inc., the Skip Barber Racing School, and Barbizon International Inc. Based in Coral Springs, Florida, and established in 1939, Barbizon led the modeling school industry. The institution served more than 200 markets around the world, and many of its graduates have become professional models, actors, and actresses.

Establishments in the industry that offered job training included Career Track Inc. and Development Dimensions International (DDI). DDI boasted clients such as General Motors, Microsoft, and Coca-Cola.

Corinthian Colleges Inc. of Santa Ana, California, was one of the largest providers of postsecondary educational services, with an emphasis on job-oriented programs. The company had 100 colleges and training centers in North America, with an enrollment of more than 110,000 students. Operating under the brand names Everest College (which also offered 20 online degrees), Heald College, and WyoTech (for automotive training), Corinthian College enrolled students mostly in associates or diploma programs in the fields of health care, information technology, and automotive technology, although the school also offered bachelor's and master's degrees.

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