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Key Statistics for AI in The Education Market
- AI in the education market was worth $2.5 billion in 2022 and is forecast to reach $88.2 billion by 2032 at a CAGR of 43.3%.
- 37% of men and 27% of women believe that AI’s impact on education is at least somewhat positive.
- As of March 2024, a significant proportion of men and women (53% of men and 51% of women) believe schools should teach children how to use AI.
- The market for AI in personalized learning is forecast to grow at a CAGR of 44.3% to reach $48.7 billion by 2030 – up from $5.2 billion in 2022.
- AI helps 73% of students understand the learning material better and 63% study more efficiently.
AI in The Education Market – Size & Forecasts
As mentioned, AI in education encompasses many spheres, including the following:
- Personalized learning
- Automated assessments and planning
- Learning accessibility
- AI skills
The technologies involved range from natural language processing (NLP) and generative AI to machine learning (ML) and deep learning.
This market was worth $2.5 billion in 2022. It’s forecast to reach $88.2 billion by 2032, at a CAGR of 43.3%.
A report by Allied Market Research stipulates that the AI services segment of the market will show an even faster CAGR of 45.6%, primarily due to the vast amounts of data and patterns gathered.
Deep learning and ML are the AI technologies forecast to show the biggest growth in the education sector and are expected to dominate by 2032, thanks to the focus on personalization and adaptability. NLP, however, will grow at the fastest CAGR of 46.6%.
K-12 will also grow with a CAGR of 46.5%.
As for different market audiences, higher education accounted for two-fifths of the AI education market in 2022.
This sector is also forecast to dominate in the next decade.
That’s not surprising as, for example, statistics tell us that generative AI made the most difference in automation possibilities for professions needing people with Master’s and PhD degrees.
Opinions on AI in Education
Given the increasing prevalence of AI in education and many news stories about ChatGPT being used for writing exams, it’s not surprising that people have strong opinions about it – not least educators and parents.
For instance, in the US, an equal proportion of people (32–33%) believe that the impacts of AI on education are positive and negative. 17% of them, however, believe that the impacts are very negative.
Opinions by Demographic
Opinions on AI in education also vary by age and gender. For example, 37% of men think AI’s impact on education is either very positive or somewhat positive.
For women, the figure is 27%. And 36% of women believe AI’s impact on education is negative or even very negative, compared to 29% of men.
As for age, Generation Z is the most welcoming of AI in education, with 46% considering it a positive development.
As for Millennials and Gen X, AI in education is welcomed by 41% and 22%, respectively. 43% of those over 65 believed AI is a negative development in education.
Opinions on AI in K-12
Since K-12 is one of the fastest-growing areas of AI use in the education market, it’s important to consider people’s attitudes toward it specifically.
As of March 2024, a significant proportion of men and women (53% of men and 51% of women) believe schools should teach children how to use AI properly.
19% of men and 23% of women, however, believe that schools should go the other way and focus on preventing AI use in education.
Interestingly, most of every age group (at least 45%) agree that schools should teach pupils how to use AI rather than focus on its prevention. However, 23% of Gen Z and 45–64-year-olds disagree.
Key Areas of AI Application in Education – Statistics & Key Players
So, what are the most significant fields of AI in education worth focusing on? Given the wide breadth, we’ll focus on the fastest-growing ones and those showing the most promise.
Personalized Learning
The market for AI in personalized learning is forecast to grow at a CAGR of 44.3% to reach $48.7 billion by 2030 – up from $5.2 billion in 2022.
These figures are not surprising, given that reaching the appropriate level of differentiated learning in large classrooms is challenging. By using AI, educators can analyze each student’s strengths and weaknesses and tailor their lesson plans accordingly.
Moreover, AI can gather data about each student’s learning patterns and overall trends, allowing for better decision-making at the top level regarding educational methods.
Accessibility & Adaptability
In many ways, accessibility in education is directly tied to personalized learning, as AI can make learning materials more accessible and inclusive for different types of students.
For example, text-to-speech AI can assist students who are visually impaired or have learning difficulties. In fact, Quizlet reports that AI helps 73% of students understand the material better and 63% study more efficiently.
Administrative Task Automation
Educators are increasingly overwhelmed with paperwork and administrative tasks, and AI can address that issue. Indeed, the statistics tell us that the automation rate with generative AI is over 50%.
Moreover, in higher education, the rate of universities worldwide using AI-backed automation is over 63%.
As with accessibility, this shift toward automation is not surprising. Reducing the administrative burdens placed on educators allows them to focus on students’ educational needs and give them a chance to develop diverse approaches.
Curriculum Generation
Finally, we come to using generative AI to develop curricula. It’s proving to be a popular application, as 38% of teachers report that generating lesson plans is their most important use case for AI.
37% of educators also state that generating tests and assignments with the help of AI is pivotal to them.
Top EdTech AI Startups
In this section, we look at innovative EdTech startups that are doing great things with AI. They all respond to at least one acute education challenge outlined in the section above, and in some cases, more than one.
Riiid
First, is the South Korean AI EdTech solution provider Riiid. Founded ten years ago, its AI tutor solution crossed the 1 million users mark in its native Korean market in 2017.
The startup’s mission is to give learners new opportunities enabling them to reach their goals through a data-driven, scientific approach.
Since its inception, it has launched several AI EdTech products, including an artificial-intelligence-as-a-service (AIaaS) platform R.Inside and adaptive assessment platform R.Test.
Riiid received $256.7 million in funding having closed the last funding round (Series E) in May 2021.
| Founded | Founders | Size | HQ | Last funding round | USP | Unicorn? |
| 2014 | Jaewe Heo | 101–250 | Seoul | Series E, $175 million | AI tutor solutions provider | No |
Elsa
AI in language-learning platforms is taking off, and this San Francisco-based startup is a prime example.
Created in 2015 by a Vietnamese immigrant, Vu Van, Elsa’s product Elsa Speak aims to help non-native English speakers confidently speak the language. It uses AI technology to correct pronunciation.
Since its launch, Elsa has millions of learners in 195 countries. It recently launched an AI English tutor. In 2023, Elsa raised $23 million in Series C, which it will use to develop and launch a B2B product. In total, Elsa has raised $48.3 million.
| Founded | Founders | Size | HQ | Last funding round | USP | Unicorn? |
| 2015 | Vu Van, Xavier Anguera | 101–250 | San Francisco | Series C, $23 million | AI-enabled ESL learning | No |
Amira
The youngest startup on our list is Amira Learning. Pitched as ‘the world’s first intelligent reading assistant,’ the company’s product recommends appropriately challenging texts and assesses students’ fluency and strengths and weaknesses. Its other products, such as Dyslexia Screener, are also geared toward adaptability.
Founded in 2018, Amira Learning is used by over 2 million people in 15 countries and supports both students and teachers. The company provides diagnostics data that helps educators make the best decisions about a student’s needs to improve reading ability.
Amira Learning closed its last funding round of $22 million in 2022. It has $40.3 million in funding.
| Founded | Founders | Size | HQ | Last funding round | USP | Unicorn? |
| 2018 | Mark Angel, Pete Jungwirth | 11–50 | Las Vegas | VC, $20 million | AI reading assistant | No |
Cognii
Last but not least, is the oldest startup on this list. Launched in 2013, Cognii provides AI solutions for K-12 and higher education.
Its NLP-centered technology offers assessment solutions tailored to open-ended assessments, tutoring solutions, adaptive learning sequences, online course design, and many other aspects of EdTech.
Therefore, it’s fair to say that Cognii could potentially respond to every acute AI EdTech need mentioned in this guide.
Cognii received a total of $1.1 million in funding. Their last round was an $800,000 grant from the National Science Foundation, obtained in 2018.
| Founded | Founders | Size | HQ | Last funding round | USP | Unicorn? |
| 2013 | Dee Kanejiya | 11–50 | Boston | Grant, $800,000 | Scalable learning solutions | No |
Future Trends of AI in Education
For the final section, we’d like to consider possible future trends. Education aims to equip us for the future and that would be the ultimate intention behind implementing AI in this industry.
Immersive Learning
We believe that AI advancements in education will go hand-in-hand with augmented reality and virtual reality (VR) to create seamless, immersive learning opportunities.
AI can analyze how students interact with VR environments and tailor scenarios that address their weaknesses or support their strengths.
For instance, thanks to ML technologies, AI-driven simulations could adapt based on student responses. This adaptability can manifest in providing challenges suited to their skill level.
Moreover, such simulations will become more realistic and contextually rich thanks to AI. From allowing students to experience historical events to letting them experiment with scientific phenomena, the future of AI in learning provides countless possibilities.
Data-Driven Decision-Making
Using AI-driven personalized learning can result in better decision-making. AI allows educators to use the data provided to create better curricula, instructional strategies, and resource allocation.
Moreover, by analyzing student performance data, metrics, and demographic trends, AI can identify areas for improvement, predict outcomes, and inform evidence-based interventions, which could make a huge difference for students with special needs.
We believe that AI-driven analytics platforms will become even more sophisticated, integrating data from many sources and providing actionable insights in real time.
AI Skills & Professional Development
Of course, any innovation should be introduced carefully, and AI in education is no exception. As the infographic shows, not everyone agrees that the next generation should be taught AI skills.
However, most people believe learning AI skills is important for the future. As AI becomes more prevalent across many industries, we will need experts who can develop, deploy, and manage AI solutions.
For that reason, teaching AI skills should be one of the most important use cases of AI in education. To address the AI skills gap, we’re already seeing more AI training programs, although they’re primarily aimed at adult learners.
This is just one of the many trends of AI in education that reflects the increasing recognition of its potential and the need for a skilled workforce to drive innovation and progress.
Final Thoughts
In this guide, we looked at AI in education statistics and its forecasts for the future. We also considered the market’s key innovations and technologies that are gaining importance, their key applications and people’s opinions about AI in education.
Innovative AI EdTech startups are solving some of education’s most pressing challenges using AI and other technologies. Based on our research, we also tried to predict some of the key future trends of the market.
Whether we are right or wrong, we look forward to seeing what AI can do for the education market and how it can assist learners who need extra support.
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