Brazil's private higher education will face shake-up

Subject

The outlook for higher education.

Significance

In the context of the worst recession since the 1930s, Brazilian higher education students are reconsidering their financial priorities. This has brought instability to the previously expanding market for private higher education, one of the most promising sectors during the years of economic expansion between the mid-2000s and early 2010s.

Impacts

• A 50% cut in government-subsidised loans to students will further reduce Brazil's potential to improve its human capital.
• Shares in large private higher education conglomerates are recovering but are below their peak valuations reached in the early 2010s.
• The poor quality of much private education will gradually force improvements or loss of students to state universities.
• In turn, poor secondary education and high drop-out rates will remain obstacles to better-quality higher education.