How public schools can reclaim their market share
Contributors Michael Grego and Michael D. Toth identify four key systems that can help districts increase student enrollments, including improved recruitment, effective marketing, top-notch customer service, and engaging every student in deeper learning that develops life skills.
January 19, 2026
Public education in the U.S. is entering one of the most competitive eras in its history. The growth of universal voucher programs and home-schooling as well as the rapid expansion of charter, microschools, and pod schooling have increased the range of educational options available to families. Parents in many communities are no longer limited to their local public school; instead, they are active consumers with real choices, and funding follows their decisions. Declining birth rates intensify the challenge, forcing traditional districts to fight for market share.
The market, in this article, refers to the total number of school-age children in the school district’s service area. The school district’s market share is the percentage of school-age children enrolled in its schools versus the percentage of students enrolled in choice options. If the school district is losing students, but the choice options collectively have a growing student enrollment, then the school district is losing market share to its choice competition.
The market shift has created a new reality for superintendents and school boards: Competition for enrollment is no longer optional—it is inevitable. Districts that cannot attract and retain students will face budget shortfalls, staff reductions, and program cuts, eroding their ability to serve communities effectively.
In this environment, some district leaders will view school closures or consolidations as the most direct solution to financial pressures. While closures may appear to offer immediate relief, the long-term academic, financial, and community consequences are far more complex, and often are far more damaging.
School closures: A false economy
The justification most often given for financially driven school closures is that closures do not negatively impact students. Yet research and real-world outcomes tell a different story.
· In Chicago Public Schools, after 50 school closures—primarily elementary schools—students from closed schools showed lower math scores that persisted for four years, according to a 2018 study by the UChicago Consortium on School Research.
· In Milwaukee Public School District, students who experience a school closure while in high school had lower attendance, graduation rates, and college attendance, according to a study published in the June 2020 issue of Economics of Education Review.
· A 2024 study from the Annenberg Institute at Brown University found that Texas students affected by school closures had lower English and math scores, more absences and disciplinary infractions, and lower high school graduation and bachelor’s degree attainment.
· A 2023 Chicago Sun-Times analysis found that school closures were concentrated in majority-Black neighborhoods, and these areas experienced larger population declines than similar neighborhoods without closures. Experts note that while closures aren’t the only cause of population declines, they signal a withdrawal of public investment and commitment to the community.
The same analysis estimated that maintaining unsold, shuttered school buildings for 10 years costs Chicago Public Schools hundreds of thousands of dollars, though the exact figure is unknown.
Members of the public deeply feel these negative effects as their communities lose stability, identity, and even property value when schools close. Parents and communities almost universally oppose school closures, often turning to alternative options rather than sending their children to a consolidated campus.
In the past, when school choice options were limited, the school closure financial modeling would safely assume nearly all families would dutifully attend their new school. However, in today’s highly competitive school choice marketplace, an estimated 15% to 25% of students likely will choose other schooling options instead of attending their newly assigned school. The enrollment losses will erase the financial savings of school closures.
Real-world examples
The following examples underscore a critical point: Closing schools without considering the competitive market costs more than it saves.
One district we talked to closed an elementary school to reduce costs. Parents, students, and community officials were extremely unhappy with the decision. Within a year, two charter school applications were submitted to the district to open a school right next door to the abandoned school. Frustrated by the loss of their community school, parents rallied behind these alternatives.
Recognizing its mistake, the district later reopened the school with expanded open enrollment. Through strong academics, effective teaching, community engagement, and outstanding customer service, it saw enrollment grow. The school now has a wait list.
In the same district, the decision to close a high-performing school that served about 320 students provides a cautionary lesson about the limits of efficiency arguments. District leaders framed the move as a cost-saving consolidation: close an older campus, shift students to a nearby larger modern facility, and realize operational economies of scale.
However, the receiving campus did not match the closed school’s academic performance. Many families, distrusting the change and open to schooling alternatives, chose private or charter options. The district’s projected savings evaporated as state and local funding tied to per-pupil attendance declined, producing a roughly $1.5 million to $2 million recurring shortfall. Beyond the dollars, the move damaged the trust between the district and the community.
Lessons from the private sector
Comparing public schools with businesses can be controversial. Many educators object to the idea that the enterprise of educating students has anything in common with the enterprise of making money.
However, the business world can offer useful parallels worth considering. Companies that were unresponsive to the marketplace can offer a cautionary tale to districts. Kmart is one such example. Once one of America’s largest retailers, Kmart failed to change quickly enough to meet the evolving needs of its customers and to differentiate itself from emerging competitors like Target and Walmart.
As sales declined, Kmart was forced into store closures that further reduced the company’s visibility and community presence. Once a location closed, customers did not shift to another Kmart; they shifted permanently to competitors. Each closure accelerated revenue loss, leading to further closures, layoffs, and eventual bankruptcy.
The lesson for schools in Kmart’s decline is clear. Districts must respond to their marketplace to win back enrollments, or they risk the same downward spiral. Competitors move in, enrollment declines, more public schools are forced to close, and community trust is lost.
Four key systems to increase student enrollment
Tweaking the current design of public schools, overlaying new programs, or engaging in costly public relations campaigns has not been enough to keep students from leaving the district or to attract families back.
We have identified four high-leverage market share systems that districts can focus on instead. School boards and district leaders can use the following questions to self-reflect on whether their systems are functioning highly enough to effectively retain and recruit students:
1. Recruitment: Are schools in your district:
- Meeting enrollment goals?
- Tracking recruitment efforts and analyzing what strategies are working best?
- Creating a strong pipeline of families interested in enrolling?
2. Marketing: Are school leaders equipped to:
- Analyze data about families and competitors in their area?
- Utilize market research to stand out from choice providers?
- Create strategies to attract families to the school?
3. Customer experience: Does your district have:
- Consistently welcoming environments across all schools?
- Clear systems to audit and improve interactions between parents/guardians and school and district staff?
- Parents and guardians who are vocal advocates for you?
4. Instruction: Is classroom instruction in your district:
- Improving proficiency, behavior, and attendance for all students?
- Engaging every student in deeper learning that develops life skills?
- Differentiated from your competitors who may offer less rigorous instruction?
Takeaways for school board members and education leaders
These four systems are further detailed in our report, “Redesigned Public Schools: A Report on How Districts Can Win Back Market Share,” which includes expert analysis of enrollment trends and choice competitor strategies.
Our report offers takeaways for school board members and other district leaders. They include:
- The growth of school choice competition for public schools requires a mind shift around market share. The days of simply managing appropriations are gone. Public education leaders must act strategically, understanding that enrollment is the currency of the future. Every decision, especially those around closures, must be evaluated not just in terms of immediate dollars saved, but also in the broader context of market share lost or gained.
- The long-term consequences of school closures often outweigh the short-term financial relief. The true cost of closures—declines in student achievement, erosion of community trust, loss of enrollment, and weakening of public commitment—frequently outweighs the modest savings initially estimated. Leaders must assess not just what can be saved, but also what will be lost.
- Education leaders must take on a new strategic role in this time of profound change. As public education continues to evolve in the marketplace of choice, school boards and superintendents must think of themselves not only as stewards of funding, but as competitors for student and parent trust and commitment. By doing so, they can reclaim lost market share—not by shrinking but by strengthening what their schools and communities offer.