Demographics drive falling California public school enrollment

Increasing private school enrollment has little to do with the six-year decline in California public school enrollment.

That’s the conclusion the Public Policy of Institute of California reached the California Department of Education.

The drop isn’t universal across the state, PPIC noted; while coastal enrollment numbers are down, schools located in some inland regions of the state have seen growth. The steepest decline has occurred in greater Los Angeles, which has experienced a 15% drop in enrollment, while the northern Central Valley was up 4% and other parts of the Central Valley were only down 3% or less.

Private schooling in California increased substantially during the pandemic, according to PPIC, but it accounts for a small share of total K-12 enrollment and is not a major factor in public school declines, which are driven largely by broader demographic shifts.

“Many California families opted to forego enrolling their children in public schools to avoid remote learning amid the pandemic, choosing homeschooling or private schools — many of which resumed in-person classes earlier than their public counterparts,” Prunty and Lafortune wrote.

Both private school enrollment and the share of students attending private schools climbed during the pandemic. After falling from 8.9% in 2006 to a low of 7.7% in the wake of the great recession, the statewide share of private and homeschool students increased quickly in recent years, reaching nearly 8.8% or 563,000 students in 2022-23. In terms of total enrollment, private school is now at its highest level since 2008-09, according to PPIC.

But the private school enrollment increase of 12,000 students in 2023, the highest increase since 2007-2008, doesn’t account for the drop in public school enrollment, PPIC researchers wrote. Roughly 12% of the decline in public school enrollment can be attributed to students being homeschooled or attending private schools, according to the report.

Instead, researchers said, falling birth rates and migration out of California are the predominant causes, and demographic trends suggest declines will continue across the state over the coming decade.

The California Department of Finance estimates the state had 38.94 million residents on Jan. 1, down almost 600,000 people since 2020.

The population pressures will also affect private schools, which will be competing with public schools for a dwindling number of students, according to PPIC.

Public charter schools are also capturing a larger share of the shrinking public education pie, up to 11.7% of California’s 5.85 million public school student in 2022-23, up from 8.7% of 6.24 million in 2014-15, according to the state education department.

Even charter enrollment fell slightly in raw numbers between 2020-21 and 2021-22, the state’s statistics say.

Charter school revenue nationally continued to grow in fiscal year 2022, as operations normalized following the pandemic and schools continued to benefit from federal aid, according to a Moody’s Investors Service report published Wednesday.

Revenues climbed significantly as schools expanded, and median operating revenue rose from $10.8 million to $12.3 million, according to Moody’s. The higher revenues were offset by a decline in margins, however, because of inflationary pressure.

Liquidity remained stable as more charter schools achieved their long-range financial targets, but leverage remains elevated in the sector. Annual debt coverage was strong, but many schools will pay significantly higher debt service in the future.