What Texas teaches: Embed teacher compensation reform in the school finance formula

Happy Veterans Day, education policy people. Today, we continue our discussion of teacher pay reform, featuring comments from Heather Peske, Mary Lynn Pruneda, Dan Goldhaber, Marguerite Roza, Pat Wolf, Ben Scafidi, and Rebecca Sibilia—plus report on recent takes by Rick Hess, Holly Korbey, Paul DiPerna, Liz Cohen, Susan Pendergrass, Jude Schwalbach, Eric Hanushek, Christy Hovanetz, Chad Aldeman, Tim Daly, and yours truly.

Last week we dug into whether schools should prioritize higher teacher salaries over other budget items, from small class sizes to instructional coaching to professional learning to tutoring. And honestly, it wasn’t as much of a slam dunk as I expected. While salaries matter, there’s a case for most other investments, too, at least when implemented effectively.

Most importantly, though, respondents agreed that across-the-board raises don’t do much good. What we need is to more aggressively differentiate pay. When districts do, the evidence is much stronger that it makes a difference, as we’ve learned from D.C. and Dallas in particular.

Most districts do a bit of differentiating—with salary supplements for special ed teachers, for example, or maybe for those with National Board Certification, and occasionally for serving in Title I and other challenging schools. But as a recent article by NCTQ’s Michael Sheehy showed, the differentiation tends to be modest, with salary stipends of just a few thousand dollars on average (versus the extra $10,000 to $20,000 per year that is required to draw the best teachers to our neediest schools).

Indeed, as NCTQ’s Heather Peske argues, we need to be much more aggressive:

We need to pay all teachers more—and effective teachers even more. Effective teachers who teach in the subjects and schools that experience persistent vacancies need to be paid the most. Why? To paraphrase, “It’s the economics, stupid.” Between 2019 and 2025, on average, beginning teacher salaries increased by 24 percent. Yet during those same years, NCTQ’s recent analysis found that home prices skyrocketed by about 47 percent and rental costs increased by about 51 percent on average. This means teachers’ purchasing power has shrunk dramatically—and many teach far from home, leading to long commutes, lower performance, and more days absent… Interest in teaching has declined sharply—and many people cite low salaries and