Differential Pay: Montana

Retaining Effective Teachers Policy


The state should support differential pay for effective teaching in shortage and high-needs areas.

Meets a small part of goal
Suggested Citation:
National Council on Teacher Quality. (2011). Differential Pay: Montana results. State Teacher Policy Database. [Data set].
Retrieved from: https://www.nctq.org/yearbook/state/MT-Differential-Pay-9

Analysis of Montana's policies

Montana supports incentives for teachers earned by teaching certain subjects and in high-needs schools. Montana code mandates that the board of education publish an annual report of "areas identified as impacted by critical quality educator shortages." Teachers working at those schools and in certain subject areas who qualify are eligible for repayment of all or part of their education loans existing at the time of the application, for up to a maximum of four years and not to exceed $3,000.

Teachers who are National Board Certified are eligible to receive a one-time $3,000 salary stipend. However, this differential pay is not tied to high-needs schools or subject-area shortage


Recommendations for Montana

Expand differential pay initiatives for teachers in both shortage subject-areas and high-needs schools.
Although the state's loan repayment program is a desirable recruitment and retention tool for teachers early in their careers, Montana should expand its program to include those already part of the teaching pool. A salary differential is an attractive incentive for every teacher, not just those with education debt. 

Support differential pay for teachers in high-needs schools.
Montana should consider tying its National Board supplement to teaching in a high-needs school. This differential pay could be an incentive to attract some of the state's most effective teachers to its low-performing schools.

State response to our analysis

Montana declined to respond to NCTQ's analyses.

Research rationale

Two recent studies emphasize the need for differential pay. In "Teacher Quality and Teacher Mobility", L. Feng and T. Sass find that high performing teachers tend to transfer to schools with a large proportion of other high performing teachers and students, while low performing teachers cluster in bottom quartile schools (CALDER: Urban Institute 2011).  Another study from T. Sass et al found that the least effective teachers in high-poverty schools were considerably less effective than the least effective teachers in low-poverty schools.

Charles Clotfelter, et al., "Would Higher Salaries Keep Teachers in High-Poverty Schools? Evidence from a Policy Intervention in North Carolina," Sanford Institute of Public Policy, Duke University, May 16, 2006 at:

Julie Kowal, et al., "Financial Incentives for Hard to Staff Positions," Center for American Progress, November 2008.

A study by researchers at Rand found that higher pay lowered attrition, and the effect was stronger in high-needs school districts. Every $1,000 increase was estimated to decrease attrition by more than 6 percent. See S.N. Kirby, et al., "Supply and Demand of Minority Teachers in Texas: Problems and Prospects," Educational Evaluation and Policy Analysis, 1999; 21(1): 47-66 at: http://epa.sagepub.com/cgi/content/abstract/21/1/47