Teachers are important because of their impact on student learning. The research indicates that raising teacher quality is perhaps the policy direction most likely to lead to substantial gains in school performance. However, there are many important aspects of teacher quality that are not captured by indicators such as qualifications, experience and tests of academic ability. The teacher characteristics that are harder to measure, but which can be vital to student learning need to be more prominent in teacher preparation and employment.

Teachers' importance is reflected in the size of the teacher workforce. Teaching is the largest single employer of graduate labour and, on average, 64% of current expenditure on schools is allocated to teachers' compensation. Teacher policies affect many people, and can have substantial implications for school budgets.

Teacher policy concerns have intensified in recent years due to the profound economic and social changes underway and the imperatives for schools to provide the foundations for lifelong learning. All school systems have been engaged in major curriculum reforms, and have placed stronger emphases on gender equality within schools, the incorporation of information and communication technology, and greater integration of students with special needs. Such developments require re-examination of the role of teachers, their preparation, work and careers.

A key challenge is to understand the complex range of factors - societal, school system level, and school level - that are giving rise to teacher policy concerns. It is important to identify the ways that these factors interact, and those which are potentially open to policy influence. Understanding the operations of the teacher labour market is particularly important. Key aspects include the factors shaping teacher demand and supply, the responsiveness of teachers to incentives, the trade-offs governments face in defining the number of teachers needed, and the mechanisms that assign teachers to schools.