In the face of unavoidable teacher layoffs, policymakers must juggle a variety of issues in choosing the best criteria for laying off teachers. The standard approach in most school districts relies on measures of seniority. Analyzing data on 4th and 5th grade teachers in New York City public schools, CALDER researchers find substantial differences in which teachers get cut under a seniority-based layoff policy versus a policy based on teacher effectiveness (value-added). The authors model the two layoff scenarios to respond to a (fictional) budget shortfall equivalent. The bottom line is that teacher layoffs based on teacher performance, preferably multiple performance measures, lead to a more effective workforce and improved student performance.