Private Schools K-12
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Industry Overview
About 27,000 private primary and secondary schools operate in the US with combined annual revenue of $25 billion. About 80 percent of these schools are affiliated with religious organizations, 30 percent with the Roman Catholic Church. While most private schools are tax-exempt, nonprofit entities, some operate on a for-profit basis.
Competitive Landscape
Demand is driven by perceived inadequacies in the public school system. The success of an individual school depends largely on its reputation for quality. Large schools can offer a wider range of instruction and have some economies of scale. Small schools can be successful by providing instruction in a special field. Schools are highly labor-intensive.
Products, Operations & Technology
Private schools provide primary and secondary education through a curriculum that is similar to that in public schools. About 60 percent of private schools provide education only through the primary grades (from kindergarten through the fifth or sixth grades); 10 percent provide only secondary education. Operations are similar to those at public schools: schools hire teachers, administrators, and support staff; buy educational and other materials; and buy or rent buildings and other space for classrooms and other student activities. Larger schools may operate food and sleeping facilities.
About half of private school students attend Catholic schools, which have an average of about 300 students. Other private schools are typically smaller, with an average of 130 students. The average public school has 530 students. The student-teacher ratio is 17:1 at Catholic schools; 12:1 at other religious schools; and 9:1 at independent schools. The national average for public schools is 16:1.
Parents send their children to private schools because of the perception that they provide a better academic or moral education. Some private schools provide intensive instruction unavailable in regular public schools, such as in music or art. Various objective measures, like test scores and eventual college attendance, seem to bear out the academic superiority of private schools. Catholic high schools have a graduation rate of 95 percent, versus 66 percent for public high schools, and the average SAT score is typically 10 percent higher at private schools, but parents' attitude and involvement may account for these differences.
Schools have two types of costs: instruction (teachers, equipment, libraries), which accounts for 62 percent of the total; and support services (counseling, health services, activities, athletics, maintenance, administration, etc.). Private schools spend less per student per year (about $3,500) than public schools (about $6,200). Per student spending at private schools varies from $2,000 in Catholic elementary schools to more than $9,000 in independent secondary schools.
To match or surpass public schools, many private schools spend heavily on computer and communication technology, mainly to allow students access to e-mail and the Internet. Some private schools use computers extensively for instruction and administration.
