Market Report: T2 China

Essential student recruitment data on China’s
expanding Tier 2 cities.

The education market in China's Tier 2 cities

Following a series of reforms across the country announced in 1978, China has improved the quality of its education system from middle schools right up to higher education institutions.

When comparing the enrolment figures across all six provinces in our report, time and again, the Shandong province comes out on top. Meanwhile, if we look at city undergraduate enrolment specifically, Wuhan (in the Hubei province) is the clear winner.

With each of our six Tier 2 cities continuing to grow economically, the strength of their education provision is expected to remain high. Below we offer a round up of education data from the government’s National Bureau of Statistics, last updated in 2017.

K-12 school enrolments in China's Tier 2 cities

Demand for quality education and top notch facilities continues to build in China’s expanding Tier 2 cities. For example, Hangzhou reportedly built 85 new kindergartens, primary and secondary schools in 2018, according to a 2019 city government report.

School enrolments across the provinces

After primary school, Chinese students will either continue to senior secondary school or secondary vocational school.

Higher education statistics in China's provinces

Next let’s look at higher education entrants, enrolments and graduates across all six provinces.

Undergraduates in higher education in China's Tier 2 cities

Due to its central location, Wuhan has always been known as a major transportation hub of Central China which has bolstered the city’s reputation as a finance, commerce, logistics and cultural centre. In fact, some have called the city the “golden key” to the region.

Wuhan is the third largest education and scientific base in China and has the largest number of undergraduate students in China, as the corresponding chart shows. In fact, the year 2017 saw three new Nobel Prize scientists come out of Wuhan.

Wuhan has over 120 higher education institutions, including two of the top ten universities in China (Wuhan University and Huazhong University of Science and Technology), and many of them have joint education programmes with institutions all around the world.

The education scene in China's Tier 2 city of Hangzhou

As reported by China Daily, Hangzhou is looking to “build itself into an international hub for educational exchanges in order to help improve its position in the education sector both at home and abroad in order to attract high-quality talent from around the world.”

“According to the three-year action plan (2019-2021) released in March 2019 by the city’s educational authority, Hangzhou will adopt a series of measures including further strengthening international educational exchanges, encouraging more local teachers to receive educational training abroad and launching more international schools to cater to growing demand from expats residing in the city.”

“In an effort to make the city more international, we have promoted English courses in primary schools throughout Hangzhou. In 2018, 31,000 students from 125 primary schools in the city began learning English from first grade,” said Zhou Jiangyong, the Hangzhou city’s party secretary.

Looking ahead to the higher education sector, Hangzhou and the wider Zhejiang province are increasingly forging ties around the world, especially in the fields of biomedicine and biotech. For example, Tecnológico de Monterrey, one of the largest private universities in Latin America, established a technology exchange centre in 2018, enabling them to send 500 researchers and students to Hangzhou each year to study biomedicine, mechanical engineering, and food engineering, as well as find commercial applications for their research.

The year 2019 also saw the opening of Hangzhou’s China Australia Medtech Innovation Park, a joint venture between Hangzhou Binjiang High-Tech Zone and the Torch High Technology Industry Development Center of the Ministry of Science and Technology.

Moreover, to boost smart manufacturing and supply chain efficiencies, the Sino-Finnish Technology Industrial Park was launched in 2019 in Hangzhou’s Qiantang Smart City (Jianggan district), aiming to “serve as an important window for scientific, healthcare and technological exchanges between China and Finland.”

China’s Tier 2 cities lure in young talent

As mentioned earlier in this report, with populations decreasing or staying stagnant in Beijing and Shanghai, and galvanised by China’s overall ageing population, the country’s tier two cities are keen to sweep up a fresh supply of educated workers to boost their own local economies, tax revenues and property markets.

Across China’s secondary and tertiary cities, we see deliberate efforts to encourage business growth and attract talent. For example, in July 2017, the “12 New Talents in Chengdu” was officially released, which outlined 12 policies supporting innovation, entrepreneurship and housing. The implementation of the new talent policy attracted more than 250,000 people to settle in Chengdu.

Meanwhile, Xi’an, Wuhan and Shenyang have launched incentive programmes to entice young graduates to take up residency.

As our graph above shows, Wuhan was home to 947,651 undergraduates in 2017, the highest of all those featured in BMI’s roadshows. In the next five years, the city aims to have one million university students not just study there, but also settle in the municipality.

The city has relaxed the requirements for household registration and even offers qualified young people a 20% discount on their rent or when purchasing property. As reported in Nikkei, the local government “subsidises housing for people who find jobs or launch businesses in the city within three years of graduating.” Generous housing policies are readily available to “university graduates aged up to 35 who find employment or start a business in the city. Wuhan also encourages businesses to prioritise local graduates when hiring.”

In 2017, over 198,400 new jobs were created in the city of Wuhan, a 10.6% increase over the year prior. Additionally, the city saw a 24.4% increase in the number of newly established businesses across the private and industrial sector (181,700).

Thanks to Wuhan’s preferential policies for foreign investors (including tax incentives, discounted loan interest rates, government subsidies and eased visa regulations), as of 2017 there were 256 Fortune Global 500 firms operating in the city – a sky-high increase over the 84 firms recorded in 2011. At the end of 2017, there were also 2,827 high-tech enterprises, an increase of 29.9% over the previous year and way up from the approximate 400 in 2012.

Major industries in Wuhan include modern manufacturing (automotive, steel and iron manufacturing) and high-tech industries (including opto-electronic technology, pharmaceutical, biological engineering, new material industry, and environmental protection). Wuhan’s Dongfeng Motor Corporation is the third largest automaker in China.”

A clear knock-on effect of the new policies, construction of condos and flats is booming in Wuhan while in Xi’an, property prices shot up after the city rolled out its incentives in March 2017.

In the north-central province of Shaanxi, Xi’an also eased its household registration process, opening it up to any university student or graduate up to the age of 35. Registered residents receive health care, a pension and other benefits, easily adding to the city’s attractiveness. It’s said that “since the programme started, Xi’an has added about half a million people to its household registry. This compares to the 290,000 people it added over the preceding five years.”

Looking further north and east, Shenyang has also developed strategies to benefit new university graduates. Qualifying young entrepreneurs can obtain an “innovation certificate” that allows them to obtain loans of up to 200,000 yuan per person. Shenyang’s policies are aimed at specific sectors including “rural tourism, nursing home services, agriculture technologies, agricultural product processing, family farmlands and internet technology.”

In addition, students with a registered permanent residence who obtain bachelor’s, master’s and doctor’s degrees can receive house purchase subsidies of 10,000, 30,000 and 60,000 yuan, respectively.

Shenyang’s reawakening from its Rust Belt reputation is clearly working. To date, Shenyang has developed economic and trade relations with approximately 190 countries and regions. It also has attracted US $42.8 billion of foreign investment and 87 out of the Fortune Global 500 companies invest and operate in Shenyang including General Motors Corporation, BMW, Michelin, General Electric, Siemens, HSBC and BASF.

International secondary schools in China’s Tier 2 cities

The international school market in China continues to go from strength to strength. According to, there were more than 70 new international schools in mainland China in 2018, of which more than one-third were concentrated in Shanghai, Suzhou and Sichuan. Looking at the Sichuan province specifically, international schools began opening as far back as 1995. During the period 2000-2009, 17 international schools opened and from 2010 to 2019, 37 new international schools opened their doors.

For a sample overview of international schools across China’s secondary and tertiary cities, readers may refer to the list compiled by the Yulong International School Network.

Student recruitment agencies in China

It might be an understatement to call the student recruitment agency landscape in China fluid.

Back in 2015, the Ministry of Education reported that there were 452 licensed and registered student recruitment agencies in China. When taking into account the unregistered agents, that number could have been as high as 10,000.

To rectify the situation, in 2017 the government relaxed regulations, loosening up the requirements to open an agency, which now means more entrepreneurial opportunities for aspiring agency owners, more choices for Chinese families but also, more need for overseas institutions to be diligent in partner screening to find quality agencies in an increasingly crowded marketplace.

Official estimates now place the number of student recruitment agencies in China at approximately 5,000. Needless to say, a lot of shuffling has taken place in the last 5-10 years.

Finding the right university to agency match

Based on agency information collected since 2008 and desk research done August 2018 till April 2019, the market research firm Bonard has compiled a total of 1,199 agencies in their database. Illustrating how quickly the landscape changes, almost 50% of the agencies that existed in Bonard’s 2012 database have been replaced by new ones in their 2019 database.

Looking at the 1,199 agencies, Bonard made the following observations:

  • 73% of them (873) have just one office.
  • 18% (216) are mid-sized, with 2-5 offices (the average is 2.46 offices). This group of companies owns or manages 531 offices across China.
  • 9% (110) are big, with more than 5 offices (the average is 14.45 offices). Most large agencies are focused on 3 cities: 47 are headquartered in Beijing, 19 in Shanghai and 7 in Guangzhou. All together, these 110 agencies own or manage 1,591 offices across the country.

With so many education agencies in China, finding the most suitable partners can be time consuming and challenging. Institutions will need to find student recruitment agencies that best match their standards, style of doing business, brand, ethical profile, enrolment priorities, and so on.

Number of quality agencies in China’s Tier 2 cities

Bonard’s research also identified the number of agencies by city and province, which we’ve listed below.

For the sake of comparison, they found 182 agencies in Beijing and 110 in Shanghai.


Hangzhou: 24

Chengdu: 32

Shenyang: 21

Xi'an: 17

Wuhan: 18

Jinan: 7


Zhejiang: 48

Sichuan: 38

Liaoning: 47

Shaanxi: 17

Hubei: 29

Shandong: 99

Interested in recruiting from China's Tier 2 Cities?

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