Should Principals Be Treated Like CEOs?

A new report argues that the way to attract and hold onto high quality school leaders is to give them more autonomy, administrative support, and a $100,000 raise.

It’s a widely held belief that a talented leader is the key to a successful school. Research shows that highly effective principals put a student’s achievement gains two to seven months ahead in a single school year—while weak leaders slow a student’s progress by the same amount.

But how can schools attract and retain good principals? One education-policy think tank suggests that part of the answer may be making the role more like an executive and giving each principal a $100,000 salary raise.

A new report, released Tuesday by the Thomas B. Fordham Institute, says too many U.S. principals lack the capacity to lead. After tracking five urban districts across the country—nearly all of which had tried to improve principal hiring practices in recent years—the study concluded that being a principal is a high-pressure, grueling, and underpaid job, where responsibilities significantly exceed authority. At a time of intensifying testing standards, when U.S. students are falling behind their international peers, schools need top-rate leaders more than ever. But inadequate salaries and limited power over key hiring decisions make the job an increasingly tougher sell. Unsurprisingly, good principals tend to come and go.

Fordham’s solution: Stop viewing principals as “glorified teachers” and more as “executives with expertise in instruction, operations, and finance.” To that end, principals should earn considerably more than other school staff who have less responsibility. And like all effective managers, principals need the ability to build a leadership team, so their duties—from academics to discipline—don’t overwhelm them. Make principalship a “phenomenal career,” the argument goes, and great people will apply.

“Todays principals are in a senior management position,” says Dr. Chester E. Finn, Jr., a former assistant secretary of education under Ronald Reagan and president of the Fordham Institute. “Demands are placed on them 24 hours a day, 7 days a week. They are the CEO of the school. As in any other field, if you want qualified people, you are going to have to pay principals commensurate with the job that they currently have.”

Much has changed over the last 20 years, he explains. Above all, the principal is now judged by student achievement and faces cascading sanctions and interventions if a school doesn’t hit certain proficiency metrics. The data burden is huge, and the sheer number of decisions can be overpowering. Which child has to go to summer school? Which reading program needs to be replaced? Which teacher needs additional professional development?

“Layer on top of that, school choice. Kids and parents have a variety of mechanisms if they aren’t satisfied,” says Dr. Finn, who sees a talent problem particularly in small towns, where it’s hard to attract superstars in education. “So now it’s also the principal’s job to potentially market the school to various constituencies and then, given tight budgets, principals also have to be fundraisers with local businesses some of the time.”

However, he warns, raising a principal’s pay alone won’t attract a new generation of leaders. Giving each principal a $100,00 raise—something he believes the country can afford, as it will amount to less than 2 percent of the K-12 school budget—goes hand in hand with giving them more professional respect and autonomy. “Who wants to be a top notch leader in a low notch job?” he says. After all, private schools already compensate headmasters like executives, as do private and public universities.

Ironically though, in many districts aspiring teachers take a pay cut on their way to the principal’s office. “It’s not uncommon for principals to have to become an assistant principal first,” says Daniela Doyle, a senior consultant with Public Impact and co-author of the Fordham study. “Often it’s not that the base pay is lower, it’s that teachers are eligible for supplemental pay through special duties they can assume or national board certifications.” Above all else, Doyle found the five school districts struggled with principal placement because they don’t really recruit. “There are great principal candidates falling through the cracks,” she says. “Schools did very little to actively find people. They often just advertised a position, sitting back and waiting for the talent to come to them, which we know from other sectors isn’t usually an effective strategy.”

And without broader recruiting initiatives—especially in smaller cities and rural districts—raises won’t necessarily attract better applicants. As Dr. Eric A. Hanushek, senior fellow at Stanford’s Hoover Institution and co-author of the 2013 study School Leaders Matter, cautions, increased salaries alone may not have a “huge effect” on the supply of potential principals because leaders are typically drawn from the local pool of teachers anyway.

“In many small towns, the educators are already in the top quartile of college earners,” explains Todd Whitaker, professor of educational leadership at Indiana State University and author of the book What Great Principals Do Differently. “There’s no question that principals are underpaid. But a number that might make sense in New York City just isn’t the problem hiring in Missouri,” says Whitaker, who believes most principals would rather have a full-time assistant than a hefty raise. “It’s not necessarily even the hours. It’s the intensity. The truth is, if we gave principals an assistant or a lot more money, we probably end up giving them increased responsibilities and we’re right back where we started.”

In other words,  one way to fix the leadership shortage may be not increased salary, but additional funding for assistant principals, school counselors, and other administrative support staff. Principals are like all people with high responsibility, according to Kate Rousmaniere, professor of educational leadership at Miami University, Oxford, Ohio and author of The Principal’s Office: A Social History of the American School Principal. They work better in teams, where they can share the workload.

But while there’s certainly a “you-get-what-you pay-for” aspect to any profession, educators don’t necessarily correspond neatly to executives. Generally, bonuses work, so long as they don’t cause principals to focus on certain criteria at the expense of their job as a whole, according to Jesse Fried, professor of law at Harvard and co-author of Pay without Performance: The Unfulfilled Promise of Executive Compensation. “People going into teaching are obviously not motivated solely by the prospect of financial gain,” he says. “[But] if society substantially underpays principals, many good people will not seek these jobs or stay in them.”

The task, then, is to strike the right balance. How much should we pay principals to attract new talent, and how much additional support do they need to meet the demands of the modern job? How do we make the role more appealing to promising candidates without pouring more money into retaining ineffective people already in place? “If policymakers are serious about figuring out which pay arrangements for principals are optimal,” proposes Fried, “they should try to run several pilot programs, each with different arrangements, and then try to learn from this experiment.”