Expert Commentary

Do students get higher test scores when teachers receive performance pay?


A new study suggests that paying teachers based on student test scores may hurt student performance in some subject areas.

The issue: Historically, public school teacher salaries have been based largely on years of experience and level of education, with teachers holding master’s degrees earning more than those with bachelor’s degrees. Over the past decade, in efforts to boost student achievement and reward the most effective educators, a number of states have begun tying a portion of teachers’ pay to student test scores. These pay-for-performance programs – also known as performance pay, merit pay and incentive pay – are controversial, often pitting teacher unions against school districts and policymakers. Teacher unions generally oppose performance pay, partly because a child’s academic progress is influenced by myriad factors outside an educator’s control, including parent involvement and the home environment.

An academic study worth reading: “Do Teacher Financial Awards Improve Teacher Retention and Student Achievement in an Urban Disadvantaged School District?,” published in the American Educational Research Journal, 2017.

About the study: Three scholars from Portland State and Rice universities sought to better understand how performance pay affects student achievement and teacher retention. They also wanted to know whether students show more improvement under teachers who receive large financial awards or teachers who receive small awards.

The authors studied 3,363 teachers in grades 3 to 8 who worked in a large, urban school district where the vast majority of students were black or Hispanic and from low-income households. The researchers looked at how receiving a financial award for performance during the 2009-10 school year affected the teachers who received them and their students during the next academic year. Awards, based on student test scores, ranged from $350 to $7,000. The average “small” award ranged from $1,200 to $1,600 while the average “large” award ranged from $2,500 to $3,500.

The scholars analyzed student scores on the state’s standardized math and reading exams as well as on the Stanford Achievement Test Series, which tests children’s knowledge of math, reading, language arts, science and social studies.

Key takeaways:

  • About a quarter of teachers received a small award and about a quarter received a large one.
  • Job retention was generally higher among teachers who received awards. For example, 83 percent of teachers who received no performance award for the 2009-10 school year still worked for the district in August 2011. Meanwhile, 91 percent of teachers who received a large award continued to work for the district in August 2011.
  • When teachers received a small award, their students tended to show improvement on the state reading test and Stanford language arts test. But the small award appeared to hurt student performance on the Stanford math test, Stanford reading test and Stanford science test.
  • When teachers received a large award, students tended to make gains on the state’s reading and math tests and the Stanford language arts test. But students appeared to do worse on the Stanford math test, Stanford reading test and Stanford science test.
  • “This study’s findings largely fail to support consistent positive effects of financial awards for teachers in this district.”
  • “Inconsistent with theorized predictions … we find little evidence to support larger benefits for the outcomes of teachers who receive large rather than small awards.”

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