
Public education enrollment has grown by about 8% since 2001, while private school enrollment has dropped by a similar percentage in the same period.

The one undeniable fact about economics is that pricing matters.

Just this morning I wanted to buy a plane ticket for a weekend trip with my wife to Montreal.
The price was $800/ticket, and I decided against it.
Pricing matters and of course the demand curve slopes downwards.
As the price of anything (including education) increases, naturally, the demand drops.

Add to this the effect of the great recession and growing availability of high-quality free education and the reasoning becomes even simpler.
The higher the price, the fewer the parents willing to buy, and vice versa.

But, in fact, this is only half the story.

From an economic point of view, the other half is even more interesting.
Consider what parents are maximizing for at the margin.
A safe, nurturing environment is the bear minimum.
What is the benefit of a great education beyond that?
What do families get in return for their investment?

It used to be that a great education was enough to secure a good job, favorable life circumstances, good friends, and a solid future...
The math was simple.
What do I have to pay (if anything) for my kid to get a career in XYZ?

Today, not only are private schools competing with increasingly high-quality, free education; but the tangible benefit of any kind of education has become very much unpredictable.

How do parents calculate, even intuitively, their return on investment?
By choosing public education, the math is simpler; parents' tradeoff is the decision to forego the alternative school in the neighborhood. There's no additional financial sacrifice to their family budget.

If you're leading a private school, you have an uphill battle ahead of you, and your marketing must be even more effective.
Are you making the rational argument for a tangible ROI to parents? What is the prospective family getting by choosing your school versus the school around the corner? Can it be quantified and verified?

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