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Buying Better Student Achievement


When we need higher student achievement on lower budgets, we're obliged to review all the money we're spending and ask: does this buy better student achievement? —Bill Gates, speaking to the Council of Chief State School Officers, November 19, 2010

How can education salary dollars best be spent to raise student achievement?

In practice, the most common compensation structure is to pay based on seniority and education. The vast majority of educators earn what they earn based on how many years they've been at it, and how many degrees or credits they've earned. This is helpful because a) generally, people expect to earn more over time, and b) in the US, we have to pay for our own education, and these increments help offset the cost. Increasingly, master's degrees are part of the initial certification process, not a later add-on to obtain higher pay.

But Bill Gates recently argued that it's a waste to pay more for master's degrees:

Another feature of school budgets is a bump in pay for master's degrees. But a master's degree has almost no impact on achievement.

Nevertheless, my own state of Washington has an average salary bump of nearly $11,000 for a master's degree - and more than half of our teachers get it. That's more than $300 million every year that doesn't help kids. And that's just one state. As a country, we spend $9 billion a year for master's degrees. 

Of course, one could argue that the master's bump is merely a way of subsidizing very expensive education requirements for teachers. At the time I completed my master's degree, the break-even point was about 5 years out. This created a significant incentive for me to stay in the education profession, at a time when I had at least two opportunities to move into the software industry.

Let's step back and examine Gates' premise, though: Is it possible to "buy" better student achievement? Establishing a one-to-one relationship between dollars and test scores is very difficult, and we might not like the side effects even if we find something that works well.

But we can certainly try to buy student achievement. The strategy most popular with reformers at the moment seems to be an attempt to do just that, by tying pay to student test scores. Performance pay has been tried in Denver and a few other places for a while, but is a new concept in the large number of states where it's currently being phased in.

So far, there is no clear evidence that it works; the most rigorous experiment so far found no impact on test scores, and many questions remain about whether this emphasis on test scores would be a good idea even if it worked. That hasn't stopped dozens of states from adopting merit pay schemes in order to attract Race to the Top funding.

What almost certainly will not improve individual performance is simply raising salaries for existing educators. If I'm doing a great job at $50K/year, paying me $5K more isn't going to make a difference, but neither will such a raise help if I'm mediocre at what I do. Why? Because money does not impart skill (just, as I argued in my last post, accountability does not impart the ability to improve). If I'm a great teacher with other marketable skills, a $5K raise may keep me in the profession longer, but it probably won't cause me to do a better job of helping kids learn. I'm in favor of across-the-board salary increases for educators for other reasons, but if our goal is to "buy" student achievement, I can't say this is a terribly direct strategy.

However, as leading education economist Eric Hanushek argued when the Nashville merit pay study came out last fall, the promise of compensation reform is in attracting different people to the profession. In other words, paying more is not a way to get better work out of the same people, but to make teaching more attractive as a profession, so that our society's best and brightest choose it over other fields such as law, medicine, and business.

If we can't afford across-the-board salary increases for educators, it might make sense to invest in initiatives aimed at attracting top talent to the profession. There are several fellowship programs, such as the Woodrow Wilson Teaching Fellowship, that offer a stipend either as a salary supplement or to offset the cost of obtaining certification. These initiatives should be studied rigorously and, if they prove successful, they should be expanded as part of a national strategy to build human capital in our schools.

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