Experimenting with Teacher Compensation: Innovations Piloted in Districts Include Skills-Based Salary Schedules, School Performance Awards and Incentives for Tougher Assignments

Because teacher pay is by far the largest part of most school districts' operating budgets (often 50 to 70 percent), it is compelling to ask if those dollars can be linked to improving teacher quality and, ultimately, student performance. Improving teacher quality means ensuring that: (1) All teachers have sufficient knowledge, skills and instructional skills to boost student learning; (2) Shortages in key subject areas (mathematics, science, technology) and hard-to-staff schools (high poverty, low performing and geographically isolated) are eliminated; and (3) School systems do a better job of recruiting, developing, placing and retaining their teacher work force. States and school districts are restructuring teacher pay systems to enhance teacher quality based on these three elements, including raising teacher pay levels, creating performance-pay structures and even paying bonuses to teachers when student performance improvement goals are met.