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Let's discuss what sorts of jobs are best suited to incentive pay. I've heard arguments for and against "merit pay" for teachers, for example. --Ed Poor Talk 17:03, 15 April 2011 (EDT)

What's best?

The short answer is it depends

The longer answer is this: I would say any position, but then the question arises of how does one measure merit? In factory or goods-producing jobs, it's usually easier since you can measure productivity by how many products are produced (assuming that the products produced don't suffer in quality because employees rush through production). If an employee is paid more for doing a great job, the firm's revenues actually increase (assuming that the cost of incentive pay is less than the cost of selling an additional unit produced). One study done in a glass factory showed a 44% increase in productivity when pay was switched from salary to incentive based pay. Half of the increase was from current employees working harder, and the other half was from employees who were not and left, and their positions were filled by highly productive employees.

For teachers it can be tricky to support an incentive-based pay. For example, are incentives given to teachers based on grades, test scores, etc.? Many of those measures can be easily manipulated and falsified to benefit the teacher (and it has been shown to be the case in many situations). Are considerations given if there is a child with a learning disability in the class? What if there is one student who, despite all efforts, continues to do poorly?

It's a very very good question to ponder. I don't know 100% what would be the best action to take in every case, but here's hoping that HR departments employee people who do! --MarkN85 17:50, 15 April 2011 (EDT)