Differential Pay: New Mexico

Retaining Effective Teachers Policy


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

Nearly meets goal
Suggested Citation:
National Council on Teacher Quality. (2015). Differential Pay: New Mexico results. State Teacher Policy Database. [Data set].
Retrieved from: https://www.nctq.org/yearbook/state/NM-Differential-Pay-72

Analysis of New Mexico's policies

New Mexico supports differential pay by which a teacher can earn additional compensation by teaching certain subjects in a high-need school. The state's STEM teacher initiative provides a $5,000 stipend per year to highly effective or exemplary STEM teachers to teach Science, Technology, Engineering or Mathematics (grades 7-12) for two years in a hard-to-staff (low performing D/F, rural, urban) school.

New Mexico does not offer additional incentives to teach at high-need schools, other than to teachers participating in the STEM teacher initiative. However, the state has no regulatory language that would directly block districts from providing differential pay. 


Recommendations for New Mexico

Support differential pay initiatives for effective teachers in high-need schools.
New Mexico should encourage districts to link compensation to additional district needs. Such policies can help districts achieve a more equitable distribution of teachers.

State response to our analysis

New Mexico asserted that in 2015, it offered hard-to-staff grants to schools needing teachers in the areas of SPED, bilingual, TESOL and other areas that have been expressed by applying schools.

New Mexico also noted that it has distributed $7.2 million (FY15) and $9.2 million (FY16) in funds for districts and charters to establish pay-for-performance programs through the Pay for Performance Pilot (PPP) program. The purpose of the PPP is to establish incentive pay pilot programs to reward New Mexico‚Äôs best teachers and principals throughout the state. Pay-for-performance systems have an impact on reducing turnover among high-performing teachers, maintaining performance among those teachers and elevating student achievement. By using local expertise and negotiating with local partners, PPP applicants will create innovative systems to reward teachers and principals for their excellence. All programs must be aligned with the NMTEACH evaluation system.

The state added that in FY15, the program received applications requesting $11 million dollars, and in FY16 the department received $17 million dollars in application requests, as there is a robust demand for performance pay in New Mexico.

Research rationale

States should help address chronic shortages and needs.
States should ensure that state-level policies (such as a uniform salary schedule) do not interfere with districts' flexibility in compensating teachers in ways that best meet their individual needs and resources. However, when it comes to addressing chronic shortages, states should do more than simply get out of the way. They should provide direct support for differential pay for effective teaching in shortage subject areas and high-need schools. Attracting effective and qualified teachers to high-need schools or filling vacancies in hard-to-staff subjects are problems that are frequently beyond a district's ability to solve. States that provide direct support for differential pay in these areas are taking an important step in promoting the equitable distribution of quality teachers. Short of providing direct support, states can also use policy levers to indicate to districts that differential pay is not only permissible but necessary.

Differential Pay: Supporting Research
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 Institute, Working Paper 57, January 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 http://www.urban.org/UploadedPDF/1001469-calder-working-paper-52.pdf.
C. Clotfelter, E. Glennie, H. Ladd, and J. Vigdor, "Would Higher Salaries Keep Teachers in High-Poverty Schools? Evidence from a Policy Intervention in North Carolina," NBER Working Paper 12285, June 2006.
J. Kowal, B. Hassel, and E. Hassel, "Financial Incentives for Hard-To-Staff Positions: Cross-Sector Lessons for Public Education," 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. Kirby, M. Berends, and S. Naftel, "Supply and Demand of Minority Teachers in Texas: Problems and Prospects," Educational Evaluation and Policy Analysis, Volume 21, No. 1, March 20, 1999, pp. 47-66 at: http://epa.sagepub.com/cgi/content/abstract/21/1/47.