Differential Pay: North Carolina

Retaining Effective Teachers Policy


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

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

Analysis of North Carolina's policies

North Carolina does not support differential pay by which a teacher can earn compensation by teaching certain subjects. However, the state has no regulatory language preventing districts from providing such differential pay.

North Carolina does support differential pay for those working in high-needs schools, which are defined as either low performing or Title I. The state does not address the amount of the incentive.

Teachers who are National Board Certified are eligible to receive a 12-percent salary differential. However, this is not tied to high-needs schools or subject-area shortages. 


Recommendations for North Carolina

Support differential pay initiatives for effective teachers in subject shortage areas.
North Carolina should encourage districts to link compensation to district needs. Such policies can help districts achieve a more equitable distribution of teachers.

Consider tying National Board supplements to teaching in high-needs schools.
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

North Carolina recognized the factual accuracy of this analysis. North Carolina also noted that the Race to the Top program provided vouchers for teachers who relocate to teach in high-needs schools. North Carolina's Race to the Top proposal and budget provide references to this program.

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