By Stephen Oliver, MBA, 10th Degree Black Belt
On 14 April 2025, in a suburb of Perth called Wanneroo, a boxing instructor named Thomas Robertson had a heated exchange with the man who owned the gym. The next day he was fired in a message posted to a workplace WhatsApp group. Seventeen months later, on 18 September 2026, the Fair Work Commission ordered the gym to pay him $9,100 gross plus superannuation, in two instalments, and rejected outright the owner’s claim that Robertson had been an independent contractor all along.
Read the reasons the Commission gave, because they are the reasons that will be given about you. Robertson wore a uniform. He taught classes on schedules the gym set. He opened the premises and closed the premises. He cleaned. He signed members up and checked them in. Commissioner Paul Schneider concluded that the practical nature of the arrangement was consistent with an employment relationship — which is a polite way of saying: you can call him whatever you like on the invoice, but he was your employee and everyone in this room knows it. (Australasian Leisure Management, 26 September 2026)
Now here is why I am writing three thousand words about a $9,100 award in Western Australia instead of mentioning it in a roundup and moving on.
Six days after that decision, the Sports & Fitness Industry Association released the number that defines the next ten years of this industry. Team-sport participation in the United States hit a record 92.3 million people aged six and over in 2025, up 7.6%, the fifth straight year of growth. And in the same release: the number of current youth team-sport coaches fell for the third consecutive year, from 8.4 million in 2022 to 6.9 million in 2025. Participation among 6-to-14-year-olds went up over the same period, from 21.1 million to 22.1 million. Participants per coach went from 2.5 to 3.2. (SFIA, 24 September 2026)
One and a half million adults stopped coaching children in three years, while a million more children showed up. That is the whole story. Demand has never been better. The thing that converts demand into revenue — a qualified adult standing in front of a group of eight-year-olds at 4:30 on a Tuesday — is disappearing, getting more expensive, and getting harder to legally qualify, all at once.
This Is Not Another Trend. I Have Watched the Trends.
I have been in the trenches since 1983, and every seven years or so somebody announces that the thing that will kill martial arts schools has finally arrived. The Karate Kid was going to kill us by flooding the market with amateurs. Then Ninja Turtles. Then Tae Bo. Then MMA was going to kill the traditional school, and then Brazilian jiu-jitsu was going to kill MMA, and then CrossFit, and then boutique fitness, and then the iPad. None of them killed a single school. What killed schools was owners who chased the trend badly — who repainted the sign, renamed the program, discounted the tuition, and never once fixed the reason nobody stayed past four months.
So I do not say “structural shift” lightly, and I am saying it here. The instructor shortage is not a trend, because it is not about taste. Nobody’s preferences changed. The supply of adults legally and practically able to teach children changed, and it changed in two directions at once, which is what makes this different from everything on that list above.
Direction one: fewer people are willing. That is the SFIA number. Direction two — and almost nobody in this industry is watching it — the bar to become one of them is being raised by governments, insurers and national bodies, simultaneously, on three continents, inside the last six months.
Look at what has landed. In Britain, the supervision exemption for child-protection checks was deleted on 1 September 2026, which put assistant instructors who are watched at all times into regulated activity. Source: GOV.UK, published 4 August 2026. The threshold is work on more than three days in any 30-day period, or overnight between 2am and 6am, and an Enhanced DBS check with a Children’s Barred List check is now available for these roles. The Safeguarding Code in Martial Arts — run by Sport England with National Lottery funding, developed with NSPCC Sport, the Ann Craft Trust and the NWG Network — is now a twelve-month renewable accreditation that assesses recruitment, DBS, staff and volunteer training, insurance and risk assessment, and schools are putting the renewal in local press as a competitive weapon (Northampton Chronicle & Echo, 24 September 2026).
In California, AB 1572 was chaptered on 18 September 2026 as Chapter 267, Statutes of 2026. It requires the state’s interscholastic federation to build an annual registration platform that verifies, before an official gets a single assignment, three things bundled into one credential: background screening — replaced from 1 July 2028 by an Activity Supervisor Clearance Certificate from the Commission on Teacher Credentialing — plus completed rules tests, training modules and sport-specific certification, plus documented proof of liability insurance (CalMatters Digital Democracy bill record). That is about game officials, not instructors. It is also the template. Screened, trained, insured, verified annually, in one auditable record, with schools able to check it. Once a state has built that for one category of adult supervising children, extending it is a bill, not an invention.
And then there is Saudi Arabia, which went furthest and did it first. Its unified Sports Law took effect on 11 June 2026. It requires Ministry licensing for the establishment and operation of sports centres, institutes and academies; sports schools need licences from both the Ministry and the Ministry of Education before they can open at all; and — the sentence to read twice — “training and technical staff at these entities must also be licensed by the Ministry.” Compliance is required by 11 June 2027, extendable by the Minister for one further equal period, with fines reaching SAR 5 million, licence suspension or cancellation, and temporary or permanent facility closure (Latham & Watkins client alert).
A national government now licenses the individual instructor, not just the business. I am not predicting that arrives in Ohio next spring. I am telling you the direction of travel is one-way, and there is no example anywhere of it reversing.
Meanwhile the national bodies are quietly subsidising the credential, because they can see the same shortage. British Judo is running a coach revalidation day on Saturday 24 October 2026 at its National Training Centre in Walsall — free, satisfying revalidation for licensed coaches, with content on child-first coaching and children’s rights delivered with Play Their Way (British Judo Association, 23 September 2026). And in New Zealand, CityFitness has made a supervised induction compulsory for members aged 14 and 15, who must attend with a parent or guardian before they get full access; the operator reports 15-to-17-year-olds rose from 22% of its membership in 2021 to 30% (Ministry of Sport, 28 September 2026). A commercial chain has publicly set a duty-of-care standard for teenagers. Your insurer read that too.
Put the four together. Fewer adults willing. A higher legal bar to qualify them. Employment law that will not let you pretend they are contractors. And a published standard of care that a plaintiff’s lawyer can hold up in front of a jury. The instructor has gone from being the thing you worry about when you get around to it, to being the single scarcest, most regulated and most expensive input in your business.
The Quick List: Why You Don’t Have Instructors
It gets annoying listening to school owners explain that they cannot find help. You are not failing to find it. You never built it. Here is the quick list, and I would bet the mortgage that at least four of these are true in your school right now:
- You are shopping for a finished product. You want a third-degree black belt who can teach, sell, and close a parent conference, and you want to hire them next month. That person does not exist in your market at a price you will pay. They exist in your student body at green belt, three years from now, if you start today.
- You have no named leadership track, so nobody knows they are on it. If you cannot recite the names of the four people currently on your instructor path and what stage each is at, you do not have a path. You have hopes.
- You treat “help” as a job description. “Go help the white belts” is not training and it is not a role. Grand Master Jeff Smith, my co-author on Extraordinary Teaching, teaches it as 30-second huddles between class segments and a two-minute debrief after class — a specific assignment, observed, then discussed. Thirty seconds of real feedback beats an hour of watching.
- You imported a star. Somewhere along the way you brought in a black belt from another school and put them on a pedestal, and your own seniors watched a stranger jump the queue. I have been unbending on this for forty years: leadership is grown from within, incoming black belts from other schools start over, and the culture is protected by having no exceptions. The exception you made two years ago is why nobody is coming up now.
- You pay cash and call it a favour. Which is how you end up in Wanneroo. It is also how you guarantee the role never becomes a career, which guarantees the person leaves the moment a real job appears.
- You lose them at first-degree black belt. Eighteen years old, black belt achieved, goal accomplished, and there is nothing on the other side of it. The most reliable source of instructors in this business walks out of your door every year with a certificate and no next objective, because you built a granular belt ladder for a nine-year-old and nothing at all for a nineteen-year-old.
- You have never done the arithmetic on what an instructor is worth to you. Which is the real reason you won’t invest. So let’s do it.
What an Instructor Is Actually Worth
I have argued for years that your average student value should be $250 to $300 a month, and that a $5,000-a-month school and a $20,000-to-$40,000-a-month school are usually running the same curriculum in the same size building. The difference is almost never the martial arts. It is capacity and retention during prime time — 4 to 8 p.m., the only four hours that matter for a kids’ program.
So here is an illustration, and I want to be clear it is an illustration built from my own benchmarks, not a survey. One additional competent instructor lets you run one more prime-time class, or lets you split an overcrowded one instead of capping enrolment. Call that fifteen students you could not otherwise serve. At $250 a month that is $3,750 a month, or $45,000 a year, from one qualified adult. Now compare it to what that adult costs you: a properly employed part-time instructor, payroll taxes included, plus a background check, plus a first-aid certificate, plus whatever your national body charges for a coaching credential — and in Britain, this October, the credential is free if you put them in a car to Walsall.
That is the trade owners refuse to make. They will spend $2,000 a month on lead generation to fill classes they do not have the staff to teach, and then complain that the leads are bad. Look at it from the perspective of the constraint: if your 5 p.m. class is full and your 6 p.m. class is full and you have one instructor, more leads do not produce more revenue. They produce a waiting list that quietly evaporates. The Parthenon has many pillars, and I will keep saying that — but the roof it holds up is your floor capacity during prime time, and you cannot buy that from an ad agency.
And while we are being honest about arithmetic: the SFIA data also tells you what you are selling. When SFIA asked participants why they play, for the first time, fun led at 58.4%, staying active at 51%, time with friends at 39.1%, being part of a team at 36% — and competition came in below all of them, at 26.1%. Every one of those first four things is delivered by a human being who knows a child’s name. None of them is delivered by equipment, by a trophy case, or by your lineage. The scarce input and the thing the customer is buying are the same thing. That is why this is the whole business.
What the Top 10% Will Do With This
Here’s reality: most owners will read the coaching-decline number as bad news about the industry. The top 10% will read it as a moat.
If every school in your market is short of instructors, and you are the only one with four people on a named ladder and a credential file that is current, then you are the only school that can open a second location, take the after-school contract, run the birthday parties, or add the 5:45 class. The competitor down the street is not beaten on marketing. He is beaten on staffing, and he cannot fix it in the ninety days it will take you to sign that contract.
Look at where the money is going and you can see the opening. In England, Sport England has pointed to the Enrichment Expansion Programme, backed by £22.5 million across around 400 secondary schools, and Every Child Can, funded with £132.5 million from dormant assets, against a National Youth Strategy ambition to halve the enrichment participation gap by 2035 (Sport England, 23 September 2026). Those are commissioning budgets. Somebody has to be bought as a delivery partner. The school that gets bought is the one whose safeguarding accreditation, insurance certificate and trained-instructor roster are already in a folder — not the one that promises to sort it out after the contract is signed.
And the timing is in your favour in a way it has not been for years. In the United States, consumer sentiment came in at 48.1 in the final September reading, a four-month low and down 15% from January, with year-ahead inflation expectations jumping to 4.6% (University of Michigan Surveys of Consumers, 25 September 2026). In Australia, average monthly gym membership rose from $62 in 2023 to $77 in 2025 while participation fell 15.6% comparing 2024/25 with 2022/23 (Australasian Leisure Management, 25 September 2026). That is an entire adjacent industry raising prices and losing people, because it raised the price without raising the value. Price is a value problem, not a market problem — and the value in what you sell is a person, not a piece of equipment. You are in the one corner of this market where the differentiator cannot be bought on a purchase order.
Do This Before Friday
Not a plan. Three actions, this week, in your school.
- Tonight, write four names on a piece of paper — four students, green belt or above, who could be on your leadership track — and beside each one write the stage they are at and the one job they will be given at the next class they attend. Then tell each of them, out loud, that they are on the track. Most of them have been waiting to be asked.
- Tomorrow, pull every instructor’s paperwork into one folder. How they are paid and under what agreement. Background check and its date. First aid. Coaching credential and its expiry. If any of them ticks the Wanneroo list — your uniform, your schedule, your keys, your opening and closing, your member sign-ups — and is being paid as a contractor, that is a conversation with your accountant this week, not next quarter.
- Before Friday, book one credential. One. The free British Judo revalidation day on 24 October if you are in the UK and eligible; whatever your national body offers if you are not; a first-aid and AED course if that is all there is. One instructor, one credential, one date on the calendar.
The coaching pool shrank by 1.5 million in three years. It is not coming back because you posted a job on Indeed. Every school owner reading this has, sitting in a 6 p.m. class tonight, the instructors they will need in 2029 — and most of them will still be calling them “the kids who help out” when 2029 arrives.
P.S. I have said for forty years that only three things happen in your school in an evening that matter: enrollments, retention, renewals. Everything else is Not Important. I will add a fourth, and I am not being cute about it. Building the person who will run the 4:30 class in three years is the only one of the four that compounds.
Stephen Oliver, MBA, 10th Degree Black Belt, is the founder of Mile High Karate and Martial Arts Wealth Mastery, and the author of The Way of the Mile High Maverick and Six Simple Steps to Add 100 New Students, and co-author with Grand Master Jeff Smith of Extraordinary Teaching.
