Analysis: Can a 2% pay rise motivate top teachers?

Analysis: Can a 2% pay rise motivate top teachers? By Peter Dolton , Professor of Economics at the University of Sussex The secretary of state for education, Nicky Morgan, has accepted recommendations from the latest School Teachers Review Body (STRB) and agreed to allow a 2% pay rise for top-performing teachers in the UK. All other teachers will recieve a 1% across-the-board pay uplift. The 2% rise to the "maxima of the main pay range" for teachers was recommended by the STRB as a way of "providing meaningful opportunity for a performance-related pay uplift". This has rekindled the debate about the efficacy and value of performance-related pay for teachers. The general evidence on performance-related pay suggests that in limited, easily defined, and measured tasks there is a clear positive relationship between pay systems where workers are directly paid according to units of work completed, such as the number of windscreens installed, and labour productivity. Performance-related pay - particularly in some private sector jobs where individual output can be measured - can be an extremely powerful tool to motivate, create incentives and help to select and retain higher performing workers. What is much more problematic is designing performance-related pay reward systems for public sector jobs where the output is not always easily measured - such as teaching.