For many years, the U.S. public education system was largely shielded from the influence of market competition. Recently however, the public has given more and more attention on how to introduce healthy competition and incentives into the public education system to produce high-achieving students, reward excellent teachers, and more fully equip America’s children for success in a competitive global economy. What are some ways to encourage healthy competition in our school system that will help our students excel? And what role can the local school board play in this process?
There are many tools available to you as a school board member as you look for ways to make the public education system more beneficial for students. Here are three areas where exciting reforms are already happening:
- Merit-Based Teacher Pay – We can all agree that teachers should be duly compensated for their work. We entrust our children to them five days a week, and we count on them to help mold the minds of the next generation. However, the entrenched system of seniority-based pay—held in place by collective bargaining agreements between school boards and teacher unions—can sometimes prevent districts from compensating teachers fairly.
First, a seniority-based system makes it difficult for school leaders to reward truly excellent teachers. A teacher who produces average or poor results but who has been in the system for several years will automatically make more money than a teacher with fewer years of experience, even if he or she produces outstanding results in students. Scholar Frederick M. Hess sums it up this way: “While, on the whole, teachers may not be underpaid, those who excel, those working in tough circumstances, and those with critical skills are clearly shortchanged. The flip side is that mediocre teachers are overpaid, sometimes substantially.”5
Second, a seniority-based system automatically gives preference to senior teachers when it comes to teaching assignments. Because many districts do not offer extra pay for difficult jobs, such as teaching in a low-income or inner city school, many experienced teachers naturally choose to serve in more stable environments or in schools with good reputations. This becomes a problem when inexperienced teachers are automatically assigned to the students most in need of a highly qualified instructor. Districts could help remedy this problem if they were allowed to offer “ ”—extra compensation for particularly difficult jobs.
Third, talented young people have diminished incentive to enter a seniority-based profession. While entry-level teachers, particularly those with only a bachelor’s degree, earn salaries comparable to those in other professions, they must wait decades to make up the wages that their peers attain within a few years. “Doctors and lawyers reap the full rewards of competence in their profession within 10 years of entrance,” writes Jacob Vigdor of Duke University. “Teachers must wait three times that long, even though evidence suggests that they become fully competent in their profession just as quickly.”6
Fourth, a seniority-based system cannot adequately fill teacher vacancies. Many union contracts make it difficult for schools to raise salary offers for hard-to-fill teacher slots (such as in mathematics and special education). An MIT study, from May 2021, concluded “that districts with more restrictive teacher contracts prior to reform and districts with more rigorous use of teacher evaluations experienced more positive impacts after reform exposure.” 
The problems associated with seniority-based pay have finally prompted a few states to experiment with merit-pay (or pay-for-performance) methods. Some of these programs focus on rewarding teachers for student achievement, but others also provide incentives for teachers to assume more responsibilities and develop professionally. Some initiatives reward all the teachers in a school that meets certain benchmarks.
Merit pay is steadily gaining support, even across political aisles and in some teacher associations. People are beginning to realize that incentives really do produce results, and, in the end, make for happier teachers and students.
2. Collective Bargaining Agreements – A collective bargaining agreement is a contract between a school district and the local teachers’ union specifying the terms by which teachers will work for the public school system. A typical agreement stipulates salaries and salary schedules, leave time, grounds for termination, disciplinary action, hours worked, and rules regarding transfers. In most districts, the collective agreement is the result of a professional council that consists of administrators, union representatives, and the district superintendent.
While it is important for teachers and other school personnel to enjoy the same privileges and protections as any other worker, collective bargaining agreements can become so stringent that they hamstring school leaders who need to make important decisions. If a school is desperate to fill an empty science-teacher slot, for example, the principal is prohibited from raising the salary offer to attract gifted candidates. In many states, a principal cannot dismiss (or sometimes even discipline) a teacher who routinely fails in his or her responsibilities. In fact, it can be such a painful and laborious process—full of expense and litigation—to dismiss a single instructor that many administrators have found it more expedient to simply transfer a poor teacher to another school. This solution, sometimes referred to as the “dance of the lemons,” is really no solution at all—it just hands the problem to someone else.
Recently, a handful of states have waged high-profile battles over what can and can’t be negotiated as part of the collective bargaining process. Some legislatures have also passed “right to work” laws, which protect workers from being required to join a union or from having to pay fees for refusing membership. It is the responsibility of school board members to know the collective bargaining laws of their state, particularly as they pertain to teachers. When negotiating with teacher unions, know what you are able to do and not do according to the laws of your district or state. Insist on clear contractual language and support your superintendent and school principals as they try to make decisions that most benefit students.
3. School Choice – School choice provides options to families on where their children can get a solid education. There are various forms of school choice; some of the more prominent types are discussed below.
 Kaitlin P. Anderson, Joshua M. Cowen, Katharine O. Strunk; The Impact of Teacher Labor Market Reforms on Student Achievement: Evidence from Michigan. Education Finance and Policy 2021; doi: https://doi.org/10.1162/edfp_a_00351