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REL Midwest Ask A REL Response

Teacher Workforce

February 2017


What does the research say about the relationship between teacher compensation and teacher recruitment and retention?


Following an established Regional Educational Laboratory (REL) Midwest protocol, we conducted a search for research reports, descriptive studies, and policy briefs on the relationship between teacher compensation and teacher recruitment and retention. For details on the databases and sources, key words and selection criteria used to create this response, please see the methods section at the end of this memo.

Below, we share a sampling of the publicly accessible resources on this topic. The search conducted is not comprehensive; other relevant references and resources may exist. We have not evaluated the quality of references and resources provided in this response, but offer this list to you for your information only.

Research References

Allen, M. B. (2005). Eight questions on teacher recruitment and retention: What does the research say? Denver, CO: Education Commission of the States. Retrieved from

From the abstract: “This is the second in a series of three reports about the research on teaching quality that the Education Commission of the States (ECS) is producing through a grant from the U.S. Department of Education's Fund for the Improvement of Education (FIE). The focus of this report is on teacher recruitment and retention. This report is intended to guide policymakers, educators and foundation officials in their efforts to improve the quality and supply of America's teacher workforce. This report, as a starting point, presents an assessment of the current baseline of the research knowledge relating to specific questions about teacher recruitment and retention. The report is structured around the discussion of eight questions, each of which can be read independently of the others. The discussion of each question allows for both a quick summary reading (in the section called Quick Answer) and a more in-depth exploration. A Summary of Studies provides an overview of the key findings and conclusions related to each question.”

Berry, B., & Eckert, J. (2012). Creating teacher incentives for school excellence and equity. Boulder, CO: National Education Policy Center. Retrieved from

From the abstract: “Ensuring that all students in America's public schools are taught by good teachers is an educational and moral imperative. Teacher incentive proposals are rarely grounded on what high-quality research indicates are the kinds of teacher incentives that lead to school excellence and equity. Few of the current approaches to creating teacher incentives take into account how specific conditions influence whether or not effective teachers will work in high-need schools and will be able to teach effectively in them. Large-scale studies and teacher testimonies suggest that working conditions are far more important than bonuses in persuading teachers to stay or leave their classrooms. National teacher turnover survey data show that teachers who leave because of job dissatisfaction do so for a variety of reasons that can be addressed: low salaries, poor support from school administrators, a lack of student motivation, a lack of teacher influence over decision-making, and student discipline problems. However, current policies, including the one framed by the federally sponsored Teacher Incentive Fund, rarely recognize these realities. We must reward expertise in ways that move beyond recruitment bonuses or pay for improved student test scores. To develop incentive policies that spread teaching expertise and allow for effective teaching will require the careful development of interlocking policies across federal, state, and local agencies. To that end, it is recommended that education policymakers do the following, which are fleshed out in the report: (1) Use the Teacher Incentive Fund to Spread Teaching Expertise for High-Needs Schools; (2) Expand Incentives in Creating Strategic Compensation; (3) Create the Working Conditions that Allow Teachers to Teach Effectively; and (4) Elevate Best Practices and Policies that Spur School Excellence and Equity.”

DeArmond, M., Gross, B., Bowen, M., Demeritt, A., & Lake, R. Managing talent for school coherence: Learning from charter management organizations. Seattle, WA: Center on Reinventing Public Education. Retrieved from

From the abstract: “The current wave of new teacher evaluation systems around the country offers an opportunity to broaden the conversation surrounding teacher effectiveness and its relationship to school coherence, to look at how schools and school systems might take a more integrated and intentional approach to attracting, training, and managing high-quality teachers. Charter management organizations (CMOs) are an important but overlooked source of ideas for thinking about how to build talent management systems that get the right teachers into the right schools and create coherent work environments that develop and support teacher performance. This report examines how CMOs manage teacher talent: How do CMOs recruit and hire teachers? How do they develop teachers? And how do they manage teacher performance? CRPE researchers analyzed data from a larger study of CMOs conducted jointly by Mathematica Policy Research and CRPE. That study offered a rich array of data on how CMOs manage teachers, including in-depth case study data and survey data from CMO central offices and principals. CMOs in the study were found to manage talent in three main ways: by recruiting and hiring for fit, providing intensive and ongoing socialization on the job, and aligning pay and career advancement opportunities with organizational goals. The study raises several key points for how districts might think about managing teacher talent to support organizational coherence.”

Glazerman, S., Protik, A., Teh, B., Bruch, J., & Max, J. (2013). Transfer incentives for high-performing teachers: Final results from a multisite randomized experiment–Executive Summary (NCEE 2014-4004). Washington, DC: National Center for Education Evaluation and Regional Assistance. Retrieved from

From the abstract: “One way to improve struggling schools' access to effective teachers is to use selective transfer incentives. Such incentives offer bonuses for the highest-performing teachers to move into schools serving the most disadvantaged students. In this report, we provide evidence from a randomized experiment that tested whether such a policy intervention can improve student test scores and other outcomes in low-achieving schools. The intervention, known to participants as the Talent Transfer Initiative (TTI), was implemented in 10 school districts in seven states. The highest-performing teachers in each district-those who ranked in roughly the top 20 percent within their subject and grade span in terms of raising student achievement year after year (an approach known as value added)-were identified. These teachers were offered $20,000, paid in installments over a two-year period, if they transferred into and remained in designated schools that had low average test scores. The main findings from the study include: (1) The transfer incentive successfully attracted high value-added teachers to fill targeted vacancies; (2) The transfer incentive had a positive impact on test scores (math and reading) in targeted elementary classrooms; and (3) The transfer incentive had a positive impact on teacher-retention rates during the payout period; retention of the high-performing teachers who transferred was similar to their counterparts in the fall immediately after the last payout.”

Hansen, M. L., Lien, D. S., Cavalluzzo, L. C., & Wenger, J. W. (2004). Relative pay and teacher retention: An empirical analysis in a large urban district. Alexandria, VA: CNA Corporation. Retrieved from

From the abstract: “Evidence suggests that compensation affects teacher retention. In general, studies have concluded that higher teacher pay increases the likelihood that a person will continue to teach. Similarly, attractive earnings opportunities outside teaching encourage people to leave the teaching profession. While these findings are intuitive, researchers have used a variety of approaches when measuring compensation, and only a few include measures of expected future earnings. This paper makes use of the Annualized Cost of Leaving (ACOL) model, a framework developed by military manpower analysts, to estimate the effect of current and future relative earnings on teacher retention. While the ACOL model is used and widely accepted by all branches of the military to analyze manpower issues, it has been used in only a few applications outside the military. The authors assert, that to their knowledge, this paper is the first to apply it to an analysis of teacher retention, and the first to model the effect of teachers' future earnings opportunities in a theoretically defensible fashion.”

Hough, H. J. & Loeb, S. (2013). Can a district-level teacher salary incentive policy improve teacher recruitment and retention? (Policy Brief 13-4). Stanford, CA: Policy Analysis for California Education. Retrieved from

From the abstract: “In this policy brief, Heather Hough and Susanna Loeb examine the effect of the Quality Teacher and Education Act of 2008 (QTEA) on teacher recruitment, retention, and overall teacher quality in the San Francisco Unified School District (SFUSD). They provide evidence that a salary increase can improve a school district's attractiveness within their local teacher labor market and increase both the size and quality of the teacher applicant pool. They also provide evidence that targeted salary increases can increase the quality of new-hires. As Hough and Loeb note, higher salaries can attract a stronger pool of teachers, but the district still must hire strategically from the pool and work to retain the high quality teachers they recruit. The Local Control Funding Formula recently adopted in California can help to ensure that districts serving the most disadvantaged students have the money available to pay their teachers more, not less, than nearby districts that are considered easier places to work. The evidence presented in this policy brief suggests that adopting policies like QTEA that increase teacher salaries can make urban school districts more competitive with more prosperous nearby school districts, which can lead to improvements in the quality of their teaching force and in the outcomes of the students they serve.”

Kelly, P., Tejeda-Delgado, C., & Slate, J. R. (2008). Superintendents' views on financial and non-financial incentives on teacher recruitment and retention. International Journal of Educational Leadership Preparation, 3(1). Retrieved from

From the abstract: “In this study, the researchers investigated the perceived relationships of financial and non-financial incentives on teacher recruitment and retention among public school teachers in the State of Texas from the perspective of 98 public school superintendents. Findings revealed that school districts tended to offer teachers' salaries over the state base pay, although signing bonuses were relatively infrequent. Other than contributing to teacher health care plans, financial incentives were generally not provided to teachers. Non-financial incentives were positively responded to by these superintendents. Implications of these findings are discussed.”

Manzeske, D., Garland, M., Williams, R., West, B., Kistner, A. M., & Rapaport, A. (2016). Teacher performance pay signals and student achievement: Are signals accurate, and how well do they work? Paper presented at the Society for Research on Educational Effectiveness Conference, Washington, DC. Retrieved from

From the abstract: “High-performing teachers tend to seek out positions at more affluent or academically challenging schools, which tend to hire more experienced, effective educators. Consequently, low-income and minority students are more likely to attend schools with less experienced and less effective educators (see, for example, DeMonte & Hanna, 2014; Office for Civil Rights, 2014). This trend is problematic as a result of the established link between educator quality and student achievement. In 2006, Congress established the Teacher Incentive Fund (TIF) to authorize ED to issue competitive grants to school districts and other education agencies. Goals of the TIF program include implementing performance-based compensation systems in high-need schools, increasing the number of effective teachers who are teaching disadvantaged students, and improving student achievement. In partnership with a TIF grantee and 12 school districts, the purpose of this multiyear study is to examine local grant implementation and to investigate summative questions such as the following: (1) What percentage of teachers receives performance-based bonuses based on observations of classroom practice and value-added measures of student growth; (2) How do bonuses differ according to the performance levels of each performance measure (i.e., classroom practice, value-added score); (3) How equitably are bonuses distributed to teachers within each performance measure, as well as between the two performance measures (i.e., classroom practice, value-added score); (4) How do teacher retention rates differ according to the performance levels of each performance measure (i.e., classroom practice, value-added score); and (5) What is the impact of TIF program initiatives on student achievement? The study takes place in schools serving students in Grades K-12 within a southern state. The schools had among the highest levels of student poverty and the lowest levels of student performance in their respective school districts.”

Maranto, R., & Shuls, J. V. (2012). How do we get them on the farm? Efforts to improve rural teacher recruitment and retention in Arkansas. Rural Educator, 34(1). Retrieved from

From the abstract: “Rural schools, particularly high poverty rural schools, often have difficulty hiring and retaining qualified teachers. Here, we discuss three programs the Arkansas Department of Education has used to attract teachers to teacher Geographic Shortage Districts (GSDs) through material incentives. Unfortunately, none of the programs have had much success, perhaps in part since the funding offered was inadequate to attract new teachers to isolated communities. Additionally, we analyze the use of materialistic and non-materialistic incentives on the websites of all school districts designated as GSDs by the Arkansas Department of Education. Few GSDs display non-materialistic appeals that might entice individuals to seek out employment in the district, with the notable exception of KIPP Delta, the only charter school on the list, which has much more success recruiting teachers. We end with suggestions for policymakers and school district officials seeking to attract teachers to geographic shortage areas.”

Morse, T. C., & Mujtaba, B. G. (2008). The challenge of recruiting and retaining teachers in the United States: Is this a compensation or demand issue? Contemporary Issues in Education Research, 1(3), 1–10. Retrieved from

From the abstract: “School districts and educational leaders as well as administrators across the nation believe they are facing teacher shortages. There is a widely-held belief that they are facing a critical shortage of teachers, primarily due to recent increases in teacher retirements and student enrollments. However, others believe that this is a superficial conclusion drawn from growing student enrollments, smaller class sizes, and retirements. The assumption incorrectly surmised is that there is not enough supply, in this case, of new teachers entering the profession, to meet demand. Studies looking at both supply and demand for new teachers entering the profession have found that the demand for teachers has indeed grown over the last decade. However, many researchers contend that there is an ample supply of teachers to not only meet, but exceed the demand. This paper explores the two sides of this topic and provides recommendations for administrators and educational leaders.”

Murray, J. E. & Brown, K. S. (2003). Paying teachers for their worth: Policies on teacher compensation at the school district and regional levels. Paper presented at the Annual Meeting of the Mid-Western Educational Research Association, Columbus, OH. Retrieved from

From the abstract: “This study reviewed the historical development of the teacher-compensation paradigm, discussed the current trends in alternative compensation policy strategies, and examined the teacher-compensation policies and practices in one state. The study was a mixed-methods policy analysis that used multiple linear regression, cluster analysis, and interpretative interviews to examine how 24 local school districts in a major metropolitan area of a Midwestern state develop and implement teacher-compensation policies. A significant relationship was found between the percentage of district revenue received from the state and the ratio of actual classroom teachers to students and the districts beginning teacher salary and maximum teacher salary. Interview data examined the role of the local human-resource officer in implementing policy and developing strategic practices. Local policy and practice, as shown through the human-resource officer, illustrates regional similarity and significant local variation as the districts seek to recruit, reward, and retain highly qualified teachers in an atmosphere of increasing accountability and decreasing revenue.” Wellington, A., Chiang, H., Hallgren, K., Speroni, C., Herrmann, M., & Burkander, P. (2016).

Evaluation of the Teacher Incentive Fund: Implementation and impacts of pay-for-performance after three years (NCEE 2016-4004). Washington, DC: National Center for Education Evaluation and Regional Assistance. Retrieved from

From the abstract: “In 2006, Congress established the Teacher Incentive Fund (TIF), which provides grants to support performance-based compensation systems for teachers and principals in high-need schools. This study focuses on performance-based compensation systems that were established under TIF grants awarded in 2010. It examines grantees' programs and implementation experiences and the impacts of pay- for-performance bonuses on educator effectiveness and student achievement. This report, the third from the study, describes the programs and implementation experiences of all 2010 TIF grantees in the 2013-014 school year, the third of four years of implementation for nearly all grantees. The main findings for all districts that received 2010 TIF grants include the following: (1) Overall implementation of TIF requirements among all 2010 TIF districts was very similar in the third year of implementation as in previous years; and (2) Few TIF districts in the third year reported that key activities related to implementation of their program were a major challenge, and districts were less likely to report major challenges in the third year than in the second year. This report also provides detailed findings from a subset of 2010 TIF grantees, the evaluation districts, that participated in a random assignment study of the pay-for-performance component of TIF. For the ten evaluation districts that completed three years of TIF implementation, the report provides an in-depth analysis of TIF implementation and the impacts of pay-for-performance bonuses on educator and student outcomes after the first (2011-2012), second (2012-2013), and third (2013-2014) years. The main findings for the ten evaluation districts include the following: (1) Pay-for-performance had small, positive impacts on students' reading and math achievement; (2) Few evaluation districts structured pay-for-performance bonuses to align well with TIF grant guidance; and (3) Teachers' understanding of performance measures continued to improve between the second and third year of implementation, but many teachers still did not understand that they were eligible for a bonus or underestimated how much they could earn.”

Wheeler, J., & Glennie, E. (2007). Can pay incentives improve the recruitment of teachers in America's hard-to-staff schools? A research summary. Durham, NC: Center for Child and Family Policy. Retrieved from

From the abstract: “The No Child Left Behind Act of 2001 (NCLB) has increased concern about the staffing difficulties faced by schools that serve a high percentage of low-achieving students. NCLB requires each student be taught in all core academic subjects by a highly-qualified teacher by the 2005-06 school year. The law defines highly-qualified teachers as those who have received a bachelor's degree, attained full state certification or licensure, and proved that they know the subject they teach. By June 2006, not one state had achieved this goal. In July, each state was required to submit a plan to ensure all classrooms have a highly-qualified teacher and that these teachers are evenly divided between poor and rich schools. Given that some schools have difficulty attracting and retaining qualified teachers, state legislatures and local school districts have shown increased interest in offering non-performance-based financial incentives to attract and retain teachers in high-need schools and subject areas. These incentive programs take a variety of forms, the most direct and most controversial of which are salary bonuses. Some school systems also use performance-based bonuses to reward teachers for student performance. This policy brief describes the scope and the effects of targeted salary incentives that are not based on student performance. Targeted financial incentives clearly influence teacher career choices although their impact varies with teacher gender, race, and age.”

Additional Organizations to Consult

Center for Teaching Quality –

From the website: “CTQ is a national nonprofit based in Carrboro, North Carolina. We focus on teachers transforming teaching-an idea (and reality!) we've been advancing since 1998. Our virtual home, the CTQ Collaboratory, is open to all who support teachers as leaders.”

Center on Great Teachers and Leaders at American Institutes for Research –

From the website: “The Center on Great Teachers and Leaders (GTL Center) is dedicated to supporting state education leaders in their efforts to grow, respect, and retain great teachers and leaders for all students. The GTL Center continues the work of the National Comprehensive Center for Teacher Quality (TQ Center) and expands its focus to provide technical assistance and online resources designed to build systems that:

  • Support the implementation of college and career
  • Ensure the equitable access of effective teachers and
  • Recruit, retain, reward, and support effective
  • Develop coherent human capital management
  • Create safe academic environments that increase student learning through positive behavior management and appropriate
  • Use data to guide professional development and improve ”


Keywords and Search Strings

The following keywords and search strings were used to search the reference databases and other sources:

  • Teacher compensation recruitment

  • Teacher compensation retention

  • Performance pay

  • Performance pay recruitment

  • Teacher incentive retention

  • Financial incentive teacher

Databases and Search Engines

We searched ERIC for relevant resources. ERIC is a free online library of more than 1.6 million citations of education research sponsored by the Institute of Education Sciences (IES). Additionally, we searched IES Programs and Resources.

Reference Search and Selection Criteria

When we were searching and reviewing resources, we considered the following criteria:

  • Date of the publication: References and resources published over the last 15 years, from 2002 to present, were include in the search and review.

  • Search priorities of reference sources: Search priority is given to study reports, briefs, and other documents that are published or reviewed by IES and other federal or federally funded organizations.

  • Methodology: We used the following methodological priorities/considerations in the review and selection of the references: (a) study types—randomized control trials, quasi-experiments, surveys, descriptive data analyses, literature reviews, policy briefs, and so forth, generally in this order, (b) target population, samples (e.g., representativeness of the target population, sample size, volunteered or randomly selected), study duration, and so forth, and (c) limitations, generalizability of the findings and conclusions, and so forth.
This memorandum is one in a series of quick-turnaround responses to specific questions posed by educational stakeholders in the Midwest Region (Illinois, Indiana, Iowa, Michigan, Minnesota, Ohio, Wisconsin), which is served by the Regional Educational Laboratory (REL Region) at American Institutes for Research. This memorandum was prepared by REL Midwest under a contract with the U.S. Department of Education’s Institute of Education Sciences (IES), Contract ED-IES-17-C-0007, administered by American Institutes for Research. Its content does not necessarily reflect the views or policies of IES or the U.S. Department of Education nor does mention of trade names, commercial products, or organizations imply endorsement by the U.S. Government.