The Meaning of Merit Pay

Dana Goldstein, a merit pay skeptic, says:

Forty years of psychological research demonstrates that when someone is faced with a complex, creative task — like teaching — money is an ineffective motivational tool, and may even delay progress. Professionals engaged in creative work are more likely to be motivated by autonomy, and by the feeling that they are part of a larger, socially important enterprise.

Matt Yglesias responds:

That seems plausible to me. But I think it mistakes the purpose of offering higher salaries to more effective teachers. I don’t think the idea is that ineffective teachers are going to suddenly will themselves into becoming great teachers in order to grab some incentive pay. The point is that if you’re employing a bunch of teachers, any of whom might depart in favor of employment elsewhere, you want to make sure that it’s your most effective teachers who are least likely to quit. And one way to do that is to make sure that it’s your most effective teachers—rather than simply your longest-serving ones—who are getting paid the most money.

I don’t think there’s really much distance between these perspectives. Professionals engaged in creative work are more likely to be motivated by autonomy, and by the feeling that they are part of a larger, socially important enterprise, and by working for an organization that employs other similarly-minded professionals, and by being paid well. Successful organizations put all of these pieces together, because if they don’t, someone else will and hire away all the good people .

To recruit and retain good teachers, schools need a lot more than merit pay–they need strong leadership, good facilities, safe working conditions, and the right kind of organizational culture. You can’t paper over the lack of those things by simply tacking on a salary bonus, even a big one, to the existing steps-and-lanes pay scale. That’s what most most “merit pay” plans have been, historically, and that’s why they haven’t worked.

Instead, we need to scrap the steps-and-lanes pay scale altogether, along with near-automatic tenure, absurd job protections and the like, and let districts and schools pay their employees the way all successful organizations that rely on professionals involved in creative work pay their employees: through a combination of subjective managerial judgement and hard data, including standardized test scores.  We can’t bribe or force-march great people into hard-to-staff schools, we need to build schools great people want to teach in, and that means fully recognizing their value in all ways, including pay. It also means ensuring that the other teachers in the school, along with the principal and larger management, see things the same way.

The great schools of the future will be professional meritocracies in a way today’s public schools are not, but not by adding test scores to the mechanistic logic of an industrial-age salary scale. Rather, they’ll spend a great deal of energy on getting the conditions and culture right, and then negotiate substantially higher and substantially more variable salaries with individual teachers. It will be an expensive, time-consuming, imperfect process with an unavoidable element of subjectivity. It will also be much, much better than what most schools use today.