Private K-12 Schools

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 30,000 private K-12 schools in the US provide basic preparatory education for children in kindergarten through 12th grade. Elementary schools typically include grades kindergarten through six. Secondary schools typically include grade seven through twelve. Combined schools offer elementary and secondary education. The vast majority of K-12 private schools are non-profit organizations and about 66% of them are religion-based.

Dependence on Skilled Staff

Private school families expect high quality education from qualified, experienced teachers.

Competition from Alternative Education

In addition to standard public schools (which are free), private schools face competition from a variety of alternative sources, including charter schools, magnet schools, and home schooling.

Industry size & Structure

The average private K-12 school operates out of a single location, employs 10-26 workers and generates over $1 million in annual revenue.

    • The private K-12 school industry consists of over 30,000 schools that educate over 4.7 million students and employ about 481,000 teachers, according to the National Center for Education Statistics Private School Universe Survey.
    • Although tuition can vary significantly, average tuition is about $7,700 for elementary schools, $13,030 for secondary schools, and $13,640 for combined schools.
    • The vast majority of K-12 private schools are nonprofit organizations.
    • Most private schools are small institutions. About 21% of private schools have less than 150 students; 25% have between 150 and 299 students; 20% have between 300 and 499 students; and 34% have 500 students or more.
                            Industry Forecast
                            Private K-12 Schools Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            May 5, 2024 - Moderate Revenue Growth Expected
                            • Private K-12 school revenue is forecast to grow at a 4.33% compounded annual rate from 2022 to 2027, comparable to the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc. Sources of revenue for private schools include tuition, private grants, donations, fundraisers, and income from endowments. Industry employment increased moderately during 2023, according to the US Bureau of Labor Statistics.
                            • The Mississippi Supreme Court has ruled that public education advocacy group Parents for Public Schools does not have legal standing to challenge the constitutionality of the state Legislature sending public money to private schools. The justices concluded that Parents for Public Schools does not have standing partly because harm to the public schools could not be proven. The opinion did not include a ruling on whether the $10 million appropriation made in 2022 by the Legislature to private schools was constitutional. Justice Robert Chamberlin wrote that the public education advocacy group says that the legislative appropriation “will adversely affect the funding of public schools by legislating a competitive advantage to the independent schools who will receive the funds. This alleged future harm, however, is speculative and not sufficient to meet even Mississippi’s permissive standing requirements.”
                            • Some 45% of private schools reported enrollment increases during the 2022-2023 school year, according to a survey from the Cato Institute think tank. About 25% saw decreases and 30% reported no change. About 88% of private schools reported either having never closed during the COVID-19 pandemic or reopening in spring or fall of 2020, earlier than most public schools.
                            • FutureEd has identified 90 private-school-choice bills in 31 states that have been introduced or pre-filed so far in 2024. Most aim to broaden private-school choice options but a few seek to scale back such programs. More bills supporting school choice are expected in the coming months, particularly in Republican-led states where choice bills failed last year or where lawmakers have yet to extend private-school-choice eligibility to all students. Last year was a record year for private-school choice, with 17 states enacting legislation to either establish or expand programs. Eight of these states—Arkansas, Florida, Indiana, Iowa, North Carolina, Ohio, Oklahoma, and Utah, adopted universal or near-universal eligibility, bringing to ten the number of states with universal programs.
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