Tutors in demand, but others are on the razor's edge

Tracey, one of my best friends, figures among the over 20 million people employed by China's education sector who suddenly feel they are on the razor's edge.

A report released by Beijing Normal University and Nasdaq-listed TAL Education Group estimated those millions work for English-language training firms, school curriculum tutoring startups, music and arts institutes, and the like, all of which operate online and/or offline in China.

Like all those workers, teachers, working staff, technicians, service providers ... employed by the sector, Tracey has been staring at an uncertain future ever since the Chinese government last month decided to rein in the errant after-school tutoring segment, casting a question mark over the whole sector's future.

Tracey's current job with a leading online education startup involves linking a large group of teachers and students, which, she said, gives her a sense of accomplishment. But she is on the lookout for another job anyway due to the current atmosphere of uncertainty.

Like Tracey, millions now fear job loss. In recent years, China's online education sector boomed as the world's top 10 universities as well as the country's leading ones like Tsinghua University and Peking University backed startups founded by a rising number of young graduates with higher education records.

Following last month's new guideline, a large group of education companies started to lay off workers. Chen Xiangdong, founder and CEO of Gaotu, a K12 education service provider, said in an internal memo that the company expects to downsize its staff by a third, which could mean several tens of thousands will likely lose their jobs.

Zhang Bangxin, founder of TAL Education Group, similarly admitted "there will definitely be layoffs".

Robin Zhang, head of marketing at a listed education company, said though his employer still has enough cash flow, he saw no bright future prospects for the education sector. "Currently, all the staff members are receiving compensation as usual. But if the company can't survive, who can tell what will happen next?"

As job losses loom, some provinces and municipalities in China have asked local education companies to report the exact number of layoffs, suggesting the government is seized of the developing situation and will likely act to prevent unemployment issues.

It is not just the employees who are concerned. Some parents are worried they may not receive full or even pro rata refund of the fees they had paid in advance to after-school tutoring firms, should the latter shut. So, they are busy pushing their children to finish learning as many lessons as quickly as possible.

But what's giving them the real jitters is the uncertainty over future in the event of tutoring platforms shutting down suddenly midterm.
"Many of the parents have already started looking for personal tutors among the staff who have recently quit, or were laid off by, tutoring platforms. They plan to hire them for one-on-one lessons," said Qi Lu, a 39-year-old mom based in Beijing.

Qi admitted she felt more anxious than others as she considers her family as one with modest means that may not be able to afford good tutors, let alone hiring the latter for expensive one-on-one long-term private tutoring.

"Therefore, I don't want this sector to die. I'm still wishing for some moderate, nuanced regulations that can maintain a fair market order and at the same time leave some space for parents and students to adjust," she said.