Indicator C1. How much is spent per student on educational institutions?

Annual expenditure per student on primary to tertiary educational institutions provides an assessment of the investment made in each student. In 2020, the average annual spending per student from primary to tertiary education in OECD countries as a whole was around USD 12 500. But this average masks a broad range of spending across OECD countries. Annual spending per student ranged from around USD 3 200 in Mexico and USD 4 500 in Colombia to over USD 26 800 in Luxembourg (Table C1.1). The drivers of expenditure per student vary across countries and by level of education: in Luxembourg, for example, low ratios of students to teaching staff and high teachers’ salaries at primary and secondary levels (see Indicator D3) are reflected in high levels of expenditure per student. In contrast, Colombia has one of the highest ratios of students to teaching staff, which tends to drive costs down (see Indicator D7). These differences can also be attributed to the diverse levels of Gross Domestic Product (GDP) and national wealth, with Colombia and Luxembourg representing the opposite ends among OECD countries (see Indicator C2).

The way resources are allocated varies widely from level to level and largely reflects the structure of the education systems. However, education still essentially takes place in settings with generally similar organisations, curricula, teaching styles and management. These shared features have tended to result in similar patterns of expenditure per student from primary to post-secondary non-tertiary levels. OECD countries as a whole spend on average around USD 10 700 per student at the primary level, USD 11 900 at secondary level and USD 18 100 at tertiary level (Table C1.1). At the secondary level, particularly at upper secondary, expenditure is strongly influenced by the programme orientation. Vocational education and training (VET) programmes, which may require specific equipment and infrastructure, typically cost more per student than general programmes.

On average across OECD countries, expenditure per student in general upper secondary programmes is about USD 11 400, compared to about USD 13 200 in vocational programmes. Luxembourg stands out as the country with the highest expenditure per student across all programme orientations at upper secondary education (over USD 26 000), with both vocational and general education receiving substantial funding. Korea and Switzerland also demonstrate significant investment in upper secondary education (over USD 19 000 per student), although no breakdown by programme orientation is available. In contrast, Bulgaria, Chile, Colombia, Mexico and Türkiye spend less than USD 6 000 per full-time equivalent upper secondary education student. Except for Colombia, where data by programme orientation are not available, all these countries spend more per vocational upper secondary student, with the greatest difference in Chile where expenditure amounts to around USD 8 600 per student in vocational programmes compared to around USD 5 100 in general programmes (Figure C1.1).

In Iceland, students in upper secondary vocational education receive significantly higher funding than those in upper secondary general education: over USD 6 500 more per student, the largest difference among countries with data available. Similarly, Austria, Germany, Lithuania, the Netherlands and Sweden also record a considerable difference, investing over USD 4 000 more per student in vocational programmes. Some countries are at the other end of the spectrum where the difference is reversed. For instance, Australia spends about USD 4 100 more per general upper secondary student than per vocational student, while New Zealand spends about USD 1 700 more. Slovenia and the United Kingdom also spend slightly more on each general upper secondary student than on each vocational one (Figure C1.1).

The lower spending per vocational upper secondary student in Australia is possibly linked to the limited availability of data for private vocational institutions, resulting in expenditure per full-time equivalent student in vocational programmes being underestimated. Due to the use of multiple data sources, it is not possible for Australia to perfectly match enrolments to expenditure.

As well as highlighting some of the caveats required when reporting expenditure data for general and vocational education (Box C1.1), these data also illustrate the priorities and investments of different countries. Understanding differences between countries in the resources they invest per student can offer insights into their educational strategies and policies and their approach to equipping students with the skills most needed on the labour market.

The relationship between expenditure per student and the number of students per teaching staff in general and vocational programmes can provide valuable insights into the educational resources allocated to each student. Greater expenditure per student coupled with a lower student-to-teaching staff ratio may indicate a greater investment in individualised attention and support for students. This can be particularly important in vocational programmes, which generally emphasise practical and hands-on training.

Vocational programmes might be expected to have lower student-to-teaching staff ratios than general programmes because of this hands-on nature, driving the expenditure per student upwards. However, no strong correlation is found when plotting differences in the expenditure per student (using information from the UNESCO, OECD and Eurostat (UOE) finance questionnaire) with the differences in the number of students per teaching staff (using information from the Education at a Glance database (OECD, 2023[3])). Only 11 out of the 22 countries with available data report that upper secondary vocational programmes have smaller number of students per teaching staff member than general programmes, and these 11 countries are not necessarily those with the greatest difference in expenditure per student between vocational and general education. In other words, although the student-to-teaching staff ratio is indeed lower in vocational programmes in some instances, it does not consistently correlate with higher expenditure per student (Figure C1.2). This is potentially explained by an under-coverage of expenditure on staff in the work-based setting of vocational programmes.

Latvia is an interesting case where upper secondary vocational programmes have twice as many students per teacher as upper secondary general programmes, the largest difference across countries with data. This may be due to the fact that vocational programmes are significantly work-based, so vocational students spend a considerable amount of time outside of school while still enrolled (see Indicator D7). Despite the much higher ratio of students per teacher in vocational programmes in Latvia, expenditure per student in upper secondary vocational programmes is still higher than in general ones, with a ratio comparable to the OECD average. This could be related to the fact that Latvia captures expenditure associated to the work-based component, while other countries may not be able to report this information.

Staff expenditure encompasses the salaries, pensions and other benefits earned by teaching and non-teaching staff and represents the largest category of expense in education budgets across all OECD countries. Attracting and retaining highly qualified professionals in the education sector requires competitive compensation packages. The investment in staff therefore reflects the level of recognition of the critical role personnel play in delivering quality education.

On average across OECD countries, expenditure on staff per full-time equivalent student is about USD 7 700 at primary level, USD 8 700 at secondary level and USD 11 200 at tertiary level, reflecting the increase in salaries with increasing levels of education (Table C1.4). This is partly because higher levels of education often require more advanced qualifications and specialised knowledge. For example, professors in tertiary education typically hold doctoral degrees, which require additional years of education. The acquisition of higher qualifications is usually accompanied by higher salaries to reflect the greater level of expertise and educational attainment. Furthermore, unlike in lower levels of education, tertiary education staff include personnel involved in research and development activities, increasing staff expenditure per student at tertiary level.

At upper secondary level, expenditure on staff per full-time equivalent student amounts to about USD 8 800 on average across OECD countries: USD 8 400 per student in general programmes and USD 9 200 in vocational programmes (Figure C1.3). Luxembourg again stands out for its high staff expenditure of around USD 20 000 per upper secondary student, which is about twice the OECD average and significantly more than any other OECD country. It surpasses Belgium, the country with the second highest expenditure, by approximately USD 6 000 for both general and vocational upper secondary education. In contrast, in Chile, Colombia and Türkiye, expenditure on staff is below USD 4 000 per full-time equivalent upper secondary student. Despite low levels of expenditure per student, the difference between general and vocational education remains significant in Türkiye: about USD 2 800 per upper secondary student in general programmes and about USD 5 000 in vocational programmes.

Iceland has the largest difference in expenditure on staff per full-time equivalent student by programme orientation in upper secondary education. In general programmes, this expenditure is approximately USD 9 200, while in vocational programmes, it rises to around USD 14 300. Austria, the Netherlands and Sweden also have substantial differences in staff expenditure in favour of upper secondary vocational education, with gaps of over USD 2 500 per student (Figure C1.3). Data on the remuneration of teachers and school heads can partly explain some of these differences (see Indicator D3). For example, in the Netherlands, for the most prevalent teacher qualification, the starting salary of teachers in general upper secondary programmes is USD 48 662 while it is USD 54 232 in vocational upper secondary programmes.

Vocational programmes might be expected to have lower student-to-teaching staff ratios than general programmes because of this hands-on nature, driving the expenditure per student upwards. However, no strong correlation is found when plotting differences in the expenditure per student (using information from the UNESCO, OECD and Eurostat (UOE) finance questionnaire) with the differences in the number of students per teaching staff (using information from the Education at a Glance database (OECD, 2023[3])). Only 10 out of the 23 countries with available data report that upper secondary vocational programmes have smaller number of students per teaching staff member than general programmes, and these 10 countries are not necessarily those with the greatest difference in expenditure per student between vocational and general education. In other words, although the student-to-teaching staff ratio is indeed lower in vocational programmes in some instances, it does not consistently correlate with higher expenditure per student (Figure C1.2). This is potentially explained by an under-coverage of expenditure on staff in the work-based setting of vocational programmes.

Policy makers are interested in the relationship between the resources devoted to education and the outcomes of education systems (OECD, 2017[4]). In order to compare the cost of education across countries, it is important to consider not just the annual expenditure per student, but also cumulative expenditure over the total period students are expected to spend at a given educational level. High expenditure per student, for example, might be offset by shorter programmes or fewer students accessing education at certain levels. On the other hand, a seemingly inexpensive education system per student might prove more costly overall if enrolment is high and students spend longer in school.

Primary and secondary education are usually compulsory across the OECD, and adding up the expenditure per student between the ages of 6 and 15 at these levels gives the theoretical cumulative expenditure per student for compulsory education. On average across OECD countries, the cumulative spending on each student between these ages adds up to a total of around USD 112 100. This total varies considerably across countries: Austria, Denmark, Iceland, Luxembourg and Norway spend over USD 150 000 per student over these years, while the figure is less than USD 50 000 in Colombia, Romania and Türkiye (Table C1.6, available on line).

The way resources are allocated to public and private institutions varies widely across educational levels, although both types of institutions have similar average levels of expenditure per student. On average across OECD countries, total expenditure on public institutions from primary to tertiary level amounts to about USD 12 600 per student, compared to under USD 13 000 in private ones. However, the differences are more substantial in countries such as Bulgaria, Latvia, the Netherlands and Türkiye, where expenditure per student on private institutions is at least 70% higher than expenditure on public ones. In contrast, in countries such as the Czech Republic, Luxembourg and New Zealand, expenditure on private institutions is at least 40% lower than on public institutions (Table C1.2).

Government funding for education is generally spent on public institutions but some countries spend a large part of the public budget on private educational institutions. On average across OECD countries, government expenditure per student on public educational institutions from primary to tertiary level (about USD 11 600) is nearly twice the government expenditure per student on private institutions (about USD 6 700). However, the gap varies at different levels of education. At non-tertiary levels, average government expenditure per student on public institutions is about USD 10 900, about 40% more than government expenditure on private institutions (about USD 7 600), whereas at tertiary level it averages about USD 14 800 on public institutions, more than three times the expenditure on private institutions (about USD 4 700) (Table C1.2).

The regular UOE data collection on education finance now covers the year 2020, providing an opportunity to examine how education finance changed in response to the COVID-19 pandemic across OECD countries. As schools were closed for extended periods in 2020, it was important to ensure that adequate resources were made available for remote learning and to maintain and expand student support programmes, and once schools reopened, it was critical to allocate additional funding to educational institutions (Al-Samarrai, Gangwar and Gala, 2020[5]). Widespread school closures due to the COVID-19 pandemic in 2020 was associated with an education expenditure increase in most countries (Figure C1.4). This can be attributed to several factors that influenced expenditure patterns during this challenging period.

For example, education systems had to rapidly adapt to remote learning and implement alternative educational strategies. Education authorities had to provide resources and support to ensure students had continued access to education (OECD, 2021[6]; OECD, 2021[7]). Teachers’ salaries and staff-related expenses, which constitute the main expenditures in education systems, were maintained during the pandemic as education staff played a vital role in delivering remote education and supporting students’ learning.

On average across OECD countries, the total expenditure on primary to tertiary educational institutions per full-time equivalent student increased by 0.4% between 2019 and 2020. This reflects a 0.3% increase in the number of full-time-equivalent students and a 0.7% increase in expenditure. This apparent stability masks important differences among OECD countries. For example, in Colombia and Lithuania expenditure on primary to tertiary educational institutions increased by more than 7.0% between 2019 and 2020 despite falling enrolments of full-time equivalent students. This change resulted in an increase in expenditure per student of 9.0% in Colombia and 13.7% in Lithuania. The increase reached 10.9% for primary to post-secondary non-tertiary students in Colombia and 18.6% for tertiary students in Lithuania. In contrast, in Chile, Hungary, Mexico and Türkiye, expenditure per student on primary to tertiary institutions fell by more than 6% during the same period (Figure C1.4 and Table C1.3).

Provisional data on education expenditure in 2021 are available for a small number of countries. These figures are useful for a comparative look at the trends going into the second year of the COVID-19 health crisis (Box C1.2).

Ancillary services are services provided by educational institutions that are peripheral to their main educational mission. The main component of ancillary services is student welfare. In primary, secondary and post-secondary non-tertiary education, student welfare services include meals, school health services and transport to and from school. At the tertiary level, they include residence halls (dormitories), dining halls and health care.

Core educational services include all expenditure that is directly related to instruction in educational institutions, including teachers’ salaries, construction and maintenance of school buildings, teaching materials, books, and school administration.

Research and development includes research performed at universities and other tertiary educational institutions, regardless of whether the research is financed from general institutional funds or through separate grants or contracts from public or private sponsors.

The annual average growth rate is calculated using the compound annual growth rate which shows the geometric progression ratio that provides a constant rate of return over the time period under analysis.

Expenditure per student on educational institutions at a particular level of education is calculated by dividing total expenditure on educational institutions at that level by the corresponding full-time equivalent enrolment. Only educational institutions and programmes for which both enrolment and expenditure data are available are taken into account. Expenditure in national currencies is converted into equivalent USD by dividing the national currency figure by the purchasing power parity (PPP) index for GDP. The PPP conversion factor is used because the market exchange rate is affected by many factors (interest rates, trade policies, expectations of economic growth, etc.) that have little to do with current relative domestic purchasing power in different OECD countries (see Annex 2 for further details).

Data on subnational regions on how much is spent per student are adjusted using national PPPs. Future work on the cost of living at subnational level would be required to fully adjust the expenditure per student used in this section.

Expenditure per student on educational institutions relative to GDP per capita is calculated by dividing expenditure per student on educational institutions by GDP per capita. In cases where the educational expenditure data and the GDP data pertain to different reference periods, the expenditure data are adjusted to the same reference period as the GDP data, using inflation rates for the OECD country in question (see Annex 2).

Full-time equivalent student: The ranking of OECD countries by annual expenditure on educational services per student is affected by differences in how countries define full-time, part-time and full-time equivalent enrolment. Some OECD countries count every participant at the tertiary level as a full-time student, while others determine students’ intensity of participation by the credits that they obtain for the successful completion of specific course units during a specified reference period. OECD countries that can accurately account for part-time enrolment have higher apparent expenditure per full-time equivalent student on educational institutions than OECD countries that cannot differentiate between the different types of student attendance.

Vocational education and training expenditure: Expenditure on workplace training provided by private companies is only included when it is part of combined school- and work-based programmes, provided that the school-based component represents at least 10% of the study over the whole programme duration. Other types of employer-provided workplace training (e.g. entirely work-based training or employee training that takes place 95% at work) are excluded. Expenditure on VET programmes include the expenditure on training (e.g. salaries and other compensation of instructors and other personnel, as well as the cost of instructional materials and equipment). However, it excludes apprentices’ wages and other compensation to students or apprentices.

Please see the OECD Handbook for Internationally Comparative Education Statistics (OECD, 2018[8]) for more information and (OECD, 2023[2]), Education at a Glance 2023 Sources, Methodologies and Technical Notes, (https://doi.org/10.1787/d7f76adc-en), for country-specific notes.

Data refer to the financial year 2020 (unless otherwise specified) and are based on the UNESCO, OECD and Eurostat (UOE) data collection on education statistics administered by the OECD in 2022 (for details see (OECD, 2023[2]), Education at a Glance 2023 Sources, Methodologies and Technical Notes, (https://doi.org/10.1787/d7f76adc-en). Data from Argentina, China, India, Indonesia, Peru, Saudi Arabia and South Africa are from the UNESCO Institute of Statistics (UIS).

The data on expenditure for 2019 to 2021 were updated based on a survey in 2022-23 and adjusted to the methods and definitions used in the current UOE data collection. Provisional data on educational expenditure in 2021 are based on an ad-hoc data collection administered by the OECD and Eurostat in 2022.

References

[5] Al-Samarrai, S., M. Gangwar and P. Gala (2020), The Impact of the COVID-19 Pandemic on Education Financing, World Bank, Washington, DC, https://doi.org/10.1596/33739.

[9] Mallick, L., P. Das and K. Pradhan (2016), “Impact of educational expenditure on economic growth in major Asian countries: Evidence from econometric analysis”, Theoretical and Applied Economics, Vol. XXIII/2, pp. 173-186.

[2] OECD (2023), Education at a Glance 2023 Sources, Methodologies and Technical Notes, OECD Publishing, Paris, https://doi.org/10.1787/d7f76adc-en.

[3] OECD (2023), Education at a Glance Database, https://stats.oecd.org/.

[1] OECD (2022), Education at a Glance 2022: OECD Indicators, OECD Publishing, Paris, https://doi.org/10.1787/3197152b-en.

[7] OECD (2021), The State of Global Education: 18 Months into the Pandemic, OECD Publishing, Paris, https://doi.org/10.1787/1a23bb23-en.

[6] OECD (2021), The State of School Education: One Year into the COVID Pandemic, OECD Publishing, Paris, https://doi.org/10.1787/201dde84-en.

[8] OECD (2018), OECD Handbook for Internationally Comparative Education Statistics 2018, OECD Publishing, Paris, https://doi.org/10.1787/9789264304444-en.

[4] OECD (2017), Education at a Glance 2017: OECD Indicators, OECD Publishing, Paris, https://doi.org/10.1787/eag-2017-en.

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