What you need to know
Taiwan's English industry is hitting a barrier — a lack of kids.
In the mid-2000s, Taiwan still had a faint flavor of the Wild Wild East. Parties in nightclubs lasted well past sunrise, and revelers often spilled out onto the street. Complaints about noise were rare. After all, people back then still tolerated election campaign trucks with blaring loudspeakers audible from a kilometer away.
The freewheeling atmosphere – and the island’s subtropical charm – attracted many a foreign adventurer. The occupation of choice was English instructor. The only requirements were a four-year university degree, a passport from the Anglosphere (including South Africa), and the ability to pass a rudimentary health check.
Yet some cram schools (buxibans) would at times bend even those limited requirements for the right candidate. Doing so was illegal, but the demand for instructors of English as a second language (ESL) often outstripped supply as the industry grew at a torrid clip. From 2003 to 2008, the number of cram schools more than doubled from 6,000 to 12,500, according to the Ministry of Education (MOE). In the Taipei area, most qualified teachers preferred to work in the city or nearby suburbs accessible by subway. A bit farther afield, schools couldn’t afford to be picky.
I knew a 22-year-old from Lithuania who got a job teaching kids in 2006 at a small cram school in Sanchong, a district of New Taipei City (then Taipei County) which was not connected to the MRT system at the time. He spoke English proficiently, but not at the level of a native speaker, and had no university degree. In his spare time, he frequented night clubs offering NT$500 all-you-can drink specials. The person who introduced him to the job, a Czech national also teaching in New Taipei City, told us the most important requirement was to look like an English teacher – in his case being tall, blonde, and fit.
Since then, Taiwan and its ESL market have changed considerably. Taiwan is less of a destination for foreign adventurers, and China and Southeast Asia both offer more excitement and usually better pay. At the same time, the central government has tightened supervision of the industry in a bid to improve teaching quality. ESL centers are thus less willing to brazenly flaunt the rules.
Growth has slowed as well. Between 2008 and 2016, the number of buxibans expanded from 12,500 to 18,500, half the rate of the preceding five years. Since 2016, growth has been flat.
“Business has been tough for a while,” says Jocelyn Lu, director of the test-prep and study abroad consultancy Cambridge Taipei. In recent years, student enrollment at Cambridge Taipei has been dropping 10-15 percent per year on average. Profit margins are razor thin, especially after the company felt the need to reduce its tuition fee by almost one-third.
Lu attributes the tough market conditions to Taiwan’s low birth rate and stagnant economy. “We don’t have enough kids to fill the classes, and besides, parents are struggling to pay the tuition,” she says.
From 2008 to 2016, Taiwan’s economy grew at an average annual rate of just 2.7 percent, compared to 4.8 percent in the 2000-2007 period. “Ten years ago, people would pay NT$100,000 tuition in cash. Now they want to pay tuition of NT$20,000 in three credit-card installments. Some clients have even asked us if we can help them apply for bank loans,” Lu says.
“Business in the ESL market hasn’t been the same since the global financial crisis,” says Bryan Gacha, a director at David’s English Center, which was established in Zhongli in 1987 and now has 10 branches throughout Taiwan. The company, which focuses on adult ESL, has no plans to expand in the immediate future, she says.
Struggle for survival
Some buxibans didn’t survive the financial crisis. One of the casualties was Berlitz Corp., which calls itself “the world’s largest language training firm.” It entered the Taiwan market in the mid-2000s, eventually opening three branches in Taipei City and one in Hsinchu. Berlitz relied almost exclusively on corporate clients, and its classes were among the priciest in Taiwan. When firms sought to slash expenses during the global financial crisis, the bottom fell out of its Taiwan business. Berlitz exited the Taiwan market in 2009.
Wall Street Institute, another global brand with high tuition, lasted until 2012. Then the company abruptly closed all five of its Taiwan branches, citing budget constraints.
In the past few years, a new challenge has emerged for Taiwan’s buxibans: how to compete with online learning. The first e-learning craze swept Taiwan over a decade ago – and it barely made a dent in the buxiban business. The software wasn’t good enough to substitute for the face-to-face experience in a classroom.
All that’s changed. iTutor, which calls itself “the world’s largest online education platform,” is based in Taipei. With 10,000 teachers in 80 countries, it offers live online courses around the clock. The company recently closed a Series C funding round that values it at over US$1 billion. Investors in the firm include Chinese e-commerce juggneraut Alibaba, the Singaporean sovereign wealth fund Temasek, and Chinese VC firm Qiming Ventures.
“E-learning offers greater convenience and perhaps a more effective approach to language study than the typical Taiwan buxiban,” says Tim Hillebran, a marketing manager for online-education firm Woodpecker Learning who has worked in the ESL industry for eight years. He notes that many of Taiwan’s cram schools rely on rote memorization to teach English. “It doesn’t deliver the desired results, so people are moving on to other ways of studying. That’s why we see so many buxibans scrambling to get into online education.”
In the Educational Testing Service’s 2016 report on test takers of the TOEIC (Test of English for International Communication), Taiwan ranked 40th out of 49 countries, behind both China (35) and South Korea (19). “Taiwan’s low ranking highlights its failure in English education,” wrote Chang Ruay-shiung, president of the National Taipei University of Business, in an October op-ed for the English-language Taipei Times.
In the article, Chang expressed surprise that China beat Taiwan on the TOEIC. Hillebran, who has taught on both sides of the Taiwan Strait, is not surprised. He says that during his three years teaching in Shanghai and Guangzhou, he was impressed with the performance of Chinese students compared to what he had seen in Taiwan. “There was a big difference in attitude,” he says. “The Chinese students had more specific goals for what they hoped to obtain from a course, and they were more receptive to advice on how they could improve their English outside of class.”
“Taiwanese are willing to spend money to learn English, but their expectations about what they will get from a course may not always be realistic,” says Gacha of David’s English Center. “Classroom time is just one part of the process. If you don’t put in the time to learn on your own, by speaking, listening, reading, and writing, you aren’t going to improve.”
At the same time, discriminatory hiring practices mean that qualified teachers are sometimes passed over. It’s no longer common to see teachers as unqualified as the young Lithuanian mentioned earlier, but whites are often hired over other races.
One Asian-American ESL teacher who spoke with Taiwan Business TOPICS on condition of anonymity says that a school told him not long ago that it was only recruiting Caucasian instructors. “They weren’t even willing to look at my resume, even though I’m a certified teacher with 10 years of experience,” he says.
The problem stems from the assumption among some Taiwanese parents that Caucasians would have higher English proficiency. “Some schools are worried that if they hire non-whites that they will need to justify that decision to parents, which is a hassle for them,” he notes.
Raising the bar
Some schools are making an effort to improve the standard of ESL education in Taiwan. BigByte Education, a Taipei-based school with six branches, distinguishes itself from the typical buxiban by using a progressive Common Core curriculum, says chief executive officer Debra Lin. Common Core is a U.S. educational initiative that sets learning goals in mathematics and English language arts/literacy (ELA) for the end of each grade.
BigByte’s students, who range in age from two and a half to the early teen years, come to class for an entire afternoon after attending Chinese school in the morning. The learning environment is English-only, with instruction provided by native speakers. Course content includes one month of project-based learning (PBL) work per semester, with students working in teams to develop solutions to real-world problems.
PBL reverses the usual pedagogy. Instead of teaching the material to students and asking them to apply what they learn to solve a problem, in PBL the problem is presented at the onset. “We have moved away from a top-down, teacher-led curriculum to one that encourages the kids to be proactive about their learning,” says Lin.
“Project-based learning (PBL) develops desirable qualities in people, like leadership, teamwork and critical thinking ability,” she explains. Initially, parents had some questions about PBL, given its differences with traditional Taiwanese education, “but now they’ve seen the results and understand the value.”
As e-learning grows in popularity, schools focused on classroom learning must differentiate themselves, says Yu of David’s English Center. At David’s, that means teachers have the freedom to design a curriculum tailored to the particular needs of their students. The focus is on interaction – both between teachers and students and among students themselves. “We hope that all of our students can learn English in a comfortable environment,” she says. “If you study just for the purpose of preparing for a test, you won’t enjoy the process.”
David’s teachers use the Socratic method, an ancient form of discourse established by Greek philosopher Socrates, who believed that lecture was not always the best teaching method. Rather, in the Socratic method teachers ask students questions requiring answers that further the conversation in a search for truth. “The Socratic method is a good way to engage a group of students in discussion,” Gacha says. “Our students are sometimes surprised at first by the directness of certain questions, but they soon discover that it’s an effective way to improve their English speaking and listening.”
Meanwhile, Cambridge Taipei, which once focused primarily on preparing students to study in the UK, has expanded its services to offer consulting for overseas programs in continental Europe, including Germany, France, and Switzerland. Those countries offer some English-language graduate programs equivalent to or even superior to those in the UK, says company director Lu. “The one-year MBA programs in the UK are popular because they can be completed in half the time of a typical program, but students aren’t always satisfied with them,” she says. “We’re glad to introduce students to some other choices.”
Additionally, Cambridge Taipei has introduced a teacher training course that provides ESL certification – both TESOL and Oxford. Students in the course are divided evenly between foreigners and locals. Top ESL jobs typically require certification, so the course is popular with career-track teachers, Lu says.
Yet even with the new services, she expects a hard road ahead. “We’re able to keep our heads above water – we’re surviving for now,” she says. “But if Taiwanese continue to earn low salaries and not have children, they won’t have money to pay for English courses, and there won’t be people to join the classes.”
(Taiwan Business TOPICS is published monthly by the American Chamber of Commerce in Taipei.)