G.com has more room for ex-Geos teachers

by Minoru Matsutani

G.communication Co. will hire some teachers from schools that it isn’t taking over from defunct Geos Corp. because it is currently experiencing a manpower shortage, G.communication President Hideo Sugimoto told The Japan Times on Wednesday.

“Some teachers left (the Geos schools) we took over because they weren’t getting paid,” Sugimoto said in an interview in G.communication’s Tokyo office.

Sugimoto said he doesn’t know how many teachers his company will hire from the Geos schools that will be shut down. G.communication has already said it will keep all of the employees at Geos schools it is taking over.

Nagoya-based G.communication runs language conversation schools, cram schools and restaurants.

Geos will close 99 English-language schools that employ 483 teachers and staff, while G.communication will take over 230 schools that employ 1,059. The company reopened 201 Geos schools last Friday, just three days after Geos filed for bankruptcy with the Tokyo District Court.

It will reopen the remaining 29 as soon as landlords of the branches sign rent contracts, Sugimoto said.

Former Geos employees will first enter work contracts with G.education, an education arm of G.communication, for three months, as had been the style with Geos, and then will sign a contract based on G.education’s style of employment, in which popular teachers get to teach more hours and are paid more, Sugimoto said.

Sugimoto also stressed that the chaos at the time of the failure of Nova Corp., another major language school chain, will not be repeated because of his company’s speedy rescue of Geos. G.communication took over operations of some Nova schools in November 2007.

“People may be worried because of the experience with Nova. In Nova’s case, we took over some of their schools awhile after the company went bankrupt and we had to start in a situation where more than 1,000 teachers didn’t have places to work,” Sugimoto said.

“This time, we raised our hand (to rescue Geos) at an early time,” he said. “If it was a week later, it would have been more chaotic.”

He also said he hadn’t been intending to expand in the language education business, and this move was just the result of salvaging a failed company.

He is also confident of making the former Geos schools profitable in a year, saying G.education will offer better services, such as convenient lesson-booking methods, than rival firms.

“The (English conversation school) market may be shrinking, but there are needs and we will meet customers’ needs,” he said.

At Nova schools, the teacher-to-student ratio is 1-to-3.5, which is “just right,” he said. He will aim to achieve that for Geos schools, whose current ratio is 1-to-2.6, he said.

Geos’ bankruptcy is believed to be tied to its persistent’s attempts at expansion, flying in the face of industry figures that showed the English-teaching market was shrinking amid the economic slump.

According to the Ministry of Economy, Trade and Industry, the monthly number of students enrolled at foreign-language conversation schools plunged from 826,858 in February 2006 to 335,604 in February this year. The corresponding monthly sales figures for the industry over the same period fell from ¥17.2 billion to ¥5.7 billion.