BEIJING, China: In response to Beijing's sweeping overhaul of the private education industry, New Oriental Education, China's largest private education business, laid off 60,000 employees in 2021.
The company's billionaire founder, Yu Minhong, confirmed the shakeup in a post on his WeChat account over the weekend, adding that the company encountered "too many changes in 2021," and blamed the layoffs on "policies, the pandemic and international relations."
As Beijing is intensifying its efforts to curb what it considers unruly business practices, Yu's post highlights the difficulties facing private enterprises in China.
New York-listed Oriental was one of the most high-profile casualties of the widespread restrictions imposed on the country's $120 billion private tutoring sector.
In July, regulators imposed new rules that banned for-profit, after-school tutoring services and restricted such companies from making profits or raising capital, as they claimed too much tutoring overwhelmed children, placed excessive financial burdens on parents, and exacerbated social inequality.
Further, Chinese authorities ordered education businesses to suspend both online and offline tutoring classes.
After Yu's post drew attention, New Oriental said it did not "represent the views of the company." In a filing to the Hong Kong stock exchange, the company said it was reviewing its latest financial results and would eventually update the market.
The private tutoring ban shocked parents and left many businesses struggling, as well as triggered a sharp selloff of Chinese education companies in New York and Hong Kong.
It was also a sudden reversal of fortune for those companies, which attracted billions of dollars of funding from major investors, such as Tiger Global Management and SoftBank Group.
In addition, life will be difficult for the few surviving companies. Yu acknowledged in his post that New Oriental emerged from the last six months "with great difficulty."
In November, TAL Education, another Chinese tutoring giant, announced that it will shift its focus from teaching school curricula for kindergarten to ninth grades and instead tutor other subjects, such as music and sports, as well as expand operations abroad.