Recent Release | 12 Dec 2022
The impact of independent schools on the UK economy
Economic Consulting Team
Oxford Economics
Oxford Economics undertook a study for the Independent Schools Council (ISC) assessing the impact of independent schools on the UK economy in 2021, and quantifying the associated taxpayer savings.
Taking direct, supply chain (‘indirect’), and wage-funded expenditure (‘induced’) impacts into account, ISC schools were found to have contributed £14.1 billion to the ‘gross value added’ measure of UK production (GVA) in that year. This was associated with 282,000 jobs, and £4.3 billion in UK tax revenues of all kinds. All UK independent schools are estimated to have supported £16.5 billion in GVA, 328,000 jobs, and £5.1 billion in taxation, through the three channels of impact.
Within those totals, the direct GVA of the ISC schools themselves amounted to £6.9 billion, associated with 152,000 jobs, and £2.0 billion in taxes—mostly income tax and National Insurance Contributions on employee wages, and unrefunded VAT on purchases of business supplies and capital projects. All of these figures would have been even higher had it not been for the restrictions on activity caused by the Covid pandemic, which resulted in fee discounts and reduced school spending.
In addition to the tax revenues generated, independent schools are estimated to have saved the UK taxpayer £4.4 billion in 2021, as a result of educating almost 540,000 pupils who would otherwise have been eligible for a UK state school place. The ISC school share of that total was £3.8 billion, relating to some 460,000 eligible pupils.
About the team
Our Economic Consulting team are world leaders in quantitative economic analysis, working with clients around the globe and across sectors to build models, forecast markets and evaluate interventions using state-of-the art techniques. Lead consultants on this project were:
Doug Godden
Lead Economist, Economic Impact
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