What's Happening with Demand for IT Courses?

Contents:

• What's happening with online vocational training
• Where is the potential seen in the context of declining demand for additional professional education

What's Happening with Online Professional Training

A slowdown in growth is observed in the segment of continuing professional education (CPE). Previously, training adults in new professions and skills, particularly in the IT sector, served as the main driver of the market. At a recent meeting, experts and executives from leading companies discussed the reasons for this phenomenon. One factor noted was the increase in the Central Bank's key interest rate, which made credit-based education less accessible for many. However, deeper changes in Russian society and the economy were also discussed. Opinions among the participants in the discussion were divided, highlighting the complexity of the situation. Ilya Kurmyshev, CEO of Yandex Praktikum, asserts that significant growth in the adult training market in Russia is not expected. Given the current economic situation and changes in educational trends, the market is facing certain challenges. It is important to adapt educational programs to modern labor market requirements and needs to ensure student demand and competitiveness. Forecasts indicate that growth in this sector will remain limited in the near future, and the quality of education and the relevance of courses will be key success factors. The continuing professional education (CPE) market has stabilized at its natural volume. Every year, roughly the same number of people decide to change careers and obtain new educations. This trend is similar to the annual increase in children entering first grade or students beginning their first year of school. The consistent interest in learning and professional growth demonstrates the need for continuous knowledge and skill upgrading in a rapidly changing labor market.

According to Ilya Kurmyshev, companies operating in the continuing professional education (CPE) sector will continue to compete for a limited market. Yandex Praktikum is seeing positive sales dynamics in the B2C segment, which includes courses for individual students. However, products focused on corporate training remain the main driver of growth. This underscores the importance of adapting educational services to business needs and increases companies' competitiveness in the CPE market.

According to Dmitry Krutov, co-founder and CEO of Skillbox, overall demand for IT courses has decreased by approximately 10%. This decline is due to the current economic situation, and although the number of people willing to study has decreased, this does not mean that the continuing professional education market in Russia has reached its limit. Currently, some couriers can earn more than entry-level IT specialists, but this does not make training any less justifiable. It's important to focus on education, helping people understand their future career opportunities, rather than focusing solely on current income. Investments in education and skills development remain relevant and necessary for a successful career in IT.

This occurs at a deeper level of the sales funnel. This work focuses on generating demand that will manifest itself not in the short term, but in six months or a year. This approach allows you to create sustainable interest in a product or service, which contributes to long-term business development.

Dmitry believes the problem of "overproduction The "juniors" concept is populist and exaggerated. In his opinion, the difficulties with juniors are not related to a lack of competencies offered by EdTech platforms, but rather to the fact that most employers are unprepared to effectively organize interns and junior teams. This doesn't mean that developers and other junior IT professionals aren't in demand. In fact, they are still needed, but successful onboarding requires the implementation of new approaches and strategies. Companies must reconsider their methods for integrating newcomers to ensure their successful development and integration into the team. Natalia Tsarevskaya-Dyakina, former Director of EdTech at the Skolkovo Foundation, emphasizes that growth opportunities in adult learning are still significant. She emphasizes new niches, such as training blue-collar workers and corporate employees aged 45+, which offer opportunities for further development. Natalia shared more details about these areas at the Smart Ranking and Livedigital webinar.

Natalia Tsarevskaya-Dyakina noted a key condition for the successful development of digital professions and education in this field: government trust in EdTech companies. The risks in this area are confirmed by cases such as the "Like Center" case and investigations against bloggers. "By 2025, we must clearly define the positioning of our domestic market," she emphasized.

Dmitry Krutov emphasized the need to create common ethical standards for EdTech companies. He proposed developing such standards on the RATIO platform so that all market participants can begin to condemn fraudulent advertising claims and dubious financial schemes. This will help increase trust in educational technologies and improve the industry's reputation.

Where is Potential Seen in the Face of Declining Demand for Continuing Professional Education?

In 2021, representatives of Russian EdTech companies began to raise the issue that the adult student audience ready for retraining is becoming depleted. Amid the market's rapid growth, Alexander Laryanovsky, Managing Partner of Skyeng, emphasized the need to appeal to a wider audience, not just the most motivated and financially secure potential students. Dmitry Krutov also emphasized that the estimated 36 million Russians who have not yet shown interest in education in new formats could become a source of growth for the EdTech market. Reaching this audience requires focusing on education and awareness of modern educational opportunities.

In recent years, the expansion of the adult EdTech audience has shown little progress due to political and economic changes, as well as the suspension of the Digital Professions project. At a meeting organized by Smart Ranking and Livedigital, participants, including company representatives and experts, discussed the need to focus on other market segments. This underscores the importance of adapting strategies to the changing external environment to successfully attract and train adults in educational technology.

Daria Ryzhkova predicts that by 2025, the children's segment of educational services, including preparation for the Basic State Exam (OGE) and Unified State Exam (USE), as well as continuing education courses, will overtake continuing professional education (CPE) in revenue. While such predictions have not previously come true, in 2024, the list of ten fastest-growing EdTech companies included primarily representatives of the children's segment. This demonstrates the high potential of this area, which seems more realistic than the expected new development of additional professional education.

Dmitry Krutov is confident that in the near future, all large companies in the Russian EdTech market will cover all segments of education: additional vocational education (APE), Higher and secondary vocational education (SVE). These companies are already competing with traditional market participants, including traditional universities, in all areas. Therefore, private educational institutions must offer products that provide formal diplomas. As the head of Skillbox noted, trust in such companies is very high, which creates additional opportunities for development and growth in the education sector.

Kristina Grahl, Director of Business Development at IThub Group, noted that the interpenetration of EdTech and formal education is a two-way process. She emphasized that ITHub College and other private SVE institutions are increasingly threatened by state educational institutions. This indicates the growing influence of technology on the educational process and the need to adapt curricula to new market demands.