Why focus on Differentiated Pay to improve Teacher Compensation?
Research shows that better pay attracts teachers to hard-to-staff schools1 and subjects.2 Despite its potential to alleviate teacher shortages and increase students’ access to effective teachers, differentiated pay remains underused. To be effective, research suggests that differential pay needs to be at least 7.5% of a teacher’s salary, or around roughly $5,000.3
State performance on Differentiated Pay for Teacher Compensation
Roughly half of states use differentiated pay to attract teachers to hard-to-staff schools or subjects.
NCTQ evaluates whether states are effectively using this policy lever by examining whether they provide funding or incentivize differentiated pay for districts in hard-to-staff schools and/or subjects. Explore the key actions below to learn more about how each state is implementing policies to improve Teacher Compensation. (NCTQ does not currently assign rankings to states for this policy area.)
Who stands out?
What are the key actions states should take?
Key Resources
State of the States 2022: Teacher Compensation Strategies
Explore NCTQ’s detailed state analysis of teacher compensation strategies.
Smart Money 2.0
Uncover teachers' salaries across 90 districts nationwide, learn about strategies to increase pay, and discover missed opportunities for raising compensation and improving outcomes.
References
- Hard-to-staff schools include but are not limited to schools designated as “high-need,” which are most commonly defined as those schools with the lowest student performance or the highest rates of students living in poverty.
- Glazerman, S., Protik, A., Teh, B. R., Bruch, J., & Max, J. (2013). Transfer Incentives for High-Performing Teachers: Final Results from a Multisite Randomized Experiment. NCEE 2014-4003. National Center for Education Evaluation and Regional Assistance.
- Pham, L. D., Nguyen, T. D., & Springer, M. G. (2020). Teacher Merit Pay: A Meta-Analysis. American Educational Research Journal, 0002831220905580.
- https://ies.ed.gov/schoolsurvey/spp/
- Cowan, J., & Goldhaber, D. (2018). Do bonuses affect teacher staffing and student achievement in high poverty schools? Evidence from an incentive for national board certified teachers in Washington State. Economics of Education Review, 65, 138-152. https://doi.org/10.1016/j.econedurev.2018.06.010. ; Swain, W. A., Rodriguez, L. A., & Springer, M. G. (2019). Selective retention bonuses for highly effective teachers in high poverty schools: Evidence from Tennessee. Economics of Education Review, 68, 148-160.
- Sheehy, M. (2024, June 6). More districts are paying teachers strategically to meet critical needs. Is yours? National Council on Teacher Quality (NCTQ). https://www.nctq.org/blog/More-districts-are-paying-teachers-strategically-to-meet-critical-needs.-Is-yours
- Hayashi, K. (2022, January 20). Presentation on Teacher Positions Filled; 5-Year Teacher Retention Rates; and Effectiveness of Teacher Shortage Differentials in the Areas of Special Education, Hard-to-Staff, and Hawaiian Language Immersion Programs on Teacher Vacancies and Retention. https://boe.hawaii.gov/Meetings/Notices/Meeting%20Material%20Library/HR_1202022_%20Presentation%20on%20Teacher%20Positions.pdf#page=3