Social and Behavioral Sciences Commons^™

Reforming Educator Compensation, Michael Podgursky

Center for Applied Economics

While compensation accounts for roughly 90 percent of K-12 instructional costs, there is little evidence of efficient or strategic design in these systems. Rigid salary schedules reward factors generally unrelated to effectiveness, induce field shortages, and encourage inequitable allocation of professional staff. Deferred compensation systems impose sharp penalties on mobility, promote early retirement and generate large unfunded liabilities. Serious attempts to bring greater efficiencies to K-12 spending and raising teacher quality must confront the dysfunctional compensation system.