Chinese after-school tutoring firm was forced to lay off 60,000

The move was a result of a ban on after-school tutoring services and the restrictions, imposed in 2021, on such firms from making profits or raising funds


New Oriental Education, the after-school tutoring service provider of China, had to lay off 60,000 people in 2021 due to the restrictions imposed on private tuitions in the country. That means, about two-thirds of the education firm’s full-time employees were laid off.

At the time of the ban, regulators and authorities had maintained that too much of tuition after school was taking a toll on the children besides burning a huge hole in their parents’ pockets. It also apparently led to social inequality. Therefore, authorities ordered that all such educational / tutorial services be banned and all online and offline tuition classes be suspended.

The founder of the education firm has, in his social-media posts held various policies, restrictions and the pandemic responsible for the layoffs, which have adversely affected the private-tuitions space of China, which was once valued at $120 billion. The firm lost about $28 billion in terms of market value in 2021.

It is reported that as of the middle of 2021, New Oriental alone had an 88,000-strong workforce, excluding the about 17,000 teachers and staff members who were employed on contract.

The Company reportedly ended up spending billions of dollars in refunding the money that students had paid as advance fee. The expenses also included the severance pay of those asked to leave and the leases of Company’s innumerable centres across the country that had to be closed.

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