Which Teachers Quit and What's the Cost of Reducing Their Quit Rates?

This study empirically examines teacher characteristics associated with teachers voluntarily leaving their job and it presents results from estimating the cost of reducing such turnover. Consistent with theory, estimation results of a discrete teacher quit choice model show teachers with characteristics associated with high job mobility as well as low pecuniary and nonpecuniary compensation are more likely to leave their job. Wage results reveal that, at the mean, teachers who stay on the job receive $7,414.97 (2019 dollars) more annually than teachers who leave, which translates to a 12.95% earnings discount for these leavers. The value of this annual earning is less than the mid-range estimates of replacement cost of $13,194.9 and $18,851.4 (2019 dollars) computed in past research as the per teacher cost for school turnover for teachers leaving after their first year and those leaving after 5 years, respectively (Milanowski et al., 2007). We interpret these compensation findings to suggest that it is cost effective for school districts to increase teacher compensation, especially for teachers possessing characteristics associated with a higher probability of leaving. Further, our findings show that, at the mean, school districts save $683.76 (2019 dollars) per teacher due to the high retention rates of salaried teachers who work longer hours. This source of high retention is consistent with past research indicating a mission focused objective of teachers who stay in the profession.