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Teacher compensation ‘incredibly inefficient,’ new research finds

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Teacher salaries are largely set by schedules which are neither performance related nor market-driven and have significant consequences on school staffing and workforce quality, new research from the National Center on Performance Incentives at Vanderbilt University’s Peabody College finds.

“[rquote]We know the way in which we currently compensate K-12 public school teachers is incredibly inefficient[/rquote],” said Matthew Springer, director of the federally-funded National Center on Performance Incentives and assistant professor of public policy and education. “The problem is that we have yet to find a better way.”

The new study, co-authored by Michael Podgursky of University of Missouri-Columbia, examined teacher compensation in the United States K-12 public school system and is featured in the latest issue of the National Tax Journal, a quarterly publication by the National Tax Association.

Matthew Springer
Matthew Springer, assistant professor and director of the National Center on Performance Incentives

In the article, the authors also summarize recent literature on compensation reform with an emphasis on studies using rigorous experimental designs to evaluate the impact of programs on student achievement and teacher outcomes.

Although several international studies report generally positive effects on student achievement, it is less clear whether performance pay policies have actually promoted learning gains in the United States, the researchers say. Only a handful of rigorous studies have been reported, all of which focus on the motivational effect of incentive pay programs and not whether these programs help recruit and retain the professions highest performers.

The authors conclude that an integrated and coherent compensation policy is the central core of an efficient human resource policy. In private and many public organizations, the compensation package is considered as a strategic whole and carefully designed to get the most human resource return per dollar of compensation. By contrast, in public K-12 education, the compensation system is fragmented and uncoordinated, with provisions often determined by means not based on systematic assessment of the overall incentive effects.

Springer’s research focuses on education policy with a particular focus on the impact of policy innovations on resource allocation decisions and student outcomes. His current research includes studies of the impact of teacher pay for performance on student achievement and teacher turnover, mobility and quality.