Season 4, Post 34: Back to school

The start of September marks the beginning of a new academic year. This is an important time for many, your author’s twin children included…

Season 4, Post 34: Back to school

The start of September marks the beginning of a new academic year. This is an important time for many, your author’s twin children included, who will be commencing their secondary education. The bad news is that today’s learners face more pressures than ever. For those at university, the statistics are stark: 38% of students do not graduate and of those who do, 41% find themselves underemployed despite having taken on $30,000 of average debt to earn a degree. These data relate to the US (and come courtesy of Chegg), but the problems highlighted are universal.

Fear not, however, there are solutions on hand. At one level, school and university architecture is being improved to create environments more conducive to learning. Significant sums of pandemic relief money in the US (and likely in other countries too) has been earmarked for educational improvements. Gone is the model of classrooms and hallways. Forward-thinking schools increasingly feature improved lighting and ventilation, better disability access and new facilities such as wellness spaces that promote mental health and outside areas more connected with nature. 

An increasing number of businesses (such as Chegg) have also expanded their platform of learning tools in order to provide additional academic support to students in their studies. 92% of students polled by Chegg said that such a platform helped them to better understand the concepts they were studying in school while a similar figure was of the view that these tools enabled them to work more efficiently.

Developments such as these matter. Typically, when the economy slows down, more people return to school (either to gain a degree or a professional qualification). Chegg noted on its August earnings call that “significantly” more students had taken summer school courses relative to a year prior. Some of this may be attributable to a post-pandemic catch-up effect, but the trend is still notable. Of course, better learning spaces and tools are not a panacea. Educational stakeholders need to think about how to allocate resource to the most deprived areas, which have suffered disproportionately in recent years. The UN warns that 23m learners (from pre-primary to university level) may never return to school because of the pandemic. As a reminder, the fourth of its Development Goals calls for ensure inclusive and equitable quality education for all.

2 September 2022​​​​​​​ ​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​

The above does not constitute investment advice and is the sole opinion of the author at the time of publication. Heptagon Capital is an investor in Chegg. The author of this piece has no personal direct investment in the business. Past performance is no guide to future performance and the value of investments and income from them can fall as well as rise.​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​


The document is provided for information purposes only and does not constitute investment advice or any recommendation to buy, or sell or otherwise transact in any investments. The document is not intended to be construed as investment research. The contents of this document are based upon sources of information which Heptagon Capital LLP believes to be reliable. However, except to the extent required by applicable law or regulations, no guarantee, warranty or representation (express or implied) is given as to the accuracy or completeness of this document or its contents and, Heptagon Capital LLP, its affiliate companies and its members, officers, employees, agents and advisors do not accept any liability or responsibility in respect of the information or any views expressed herein. Opinions expressed whether in general or in both on the performance of individual investments and in a wider economic context represent the views of the contributor at the time of preparation. Where this document provides forward-looking statements which are based on relevant reports, current opinions, expectations and projections, actual results could differ materially from those anticipated in such statements. All opinions and estimates included in the document are subject to change without notice and Heptagon Capital LLP is under no obligation to update or revise information contained in the document. Furthermore, Heptagon Capital LLP disclaims any liability for any loss, damage, costs or expenses (including direct, indirect, special and consequential) howsoever arising which any person may suffer or incur as a result of viewing or utilising any information included in this document. 

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