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The research provides strong support for the conclusion that compensation plays a key role in the recruitment and retention of teachers. Not surprisingly, the research indicates that increasing compensation tends to increase the rate of teacher retention, but this relationship is not a simple one. Compensation seems to have varying impact on retention depending upon such other factors as teachers' gender, level of experience and current job satisfaction. There is moderate evidence that working conditions may trump salary in some cases as a factor in teacher retention and also that it is the relative salary between districts that is the important consideration. The research evidence is inconclusive about whether limited career-advancement opportunities in teaching contribute to attrition.

With regard to teacher recruitment, there is limited evidence of a positive correlation between recruitment and various financial incentives, including compensation. With regard to teacher quality, the research is inconclusive whether financial incentives have any impact.

Given the complexity of the issue of compensation and the interaction of compensation with other factors such as working conditions and general job satisfaction, drawing the implications of the research for policy is not an easy matter. The clearest recommendation that can be made is for policymakers to ensure teacher salaries in their state or district are comparable to those in neighboring states and districts. The research does not provide any guidance on the issue of differentiated teacher pay or on across-the-board salary increases. It does indicate clearly, however, that the local labor market is the determining factor and not national trends.

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