In the early grades, grouping by reading ability rather than skill can widen reading gaps in the long term.

Some combination of whole-group and small-group reading instruction happens in the majority of elementary school classrooms. Reading groups are a routine part of the daily reading instruction block, and many educators assume that small group instruction is inherently better than whole group for helping students learn to read.

While teachers approach the grouping structure differently, a common scenario has been to group students by reading ability level — high, average, or low — and matching each group to different texts based on their reading ability. Small groups are typically established in the beginning of the school year, and students can remain in the same group with little movement throughout the year. 

There is research that shows ability grouping in the early grades concentrates and widens reading gaps in the long term. Experts caution that the efficacy of small groups depends on how they are used — what and how the teacher is teaching to differentiate instruction, what materials are being used, what students may or may not actually need practice with, what students are doing when they are not with the teacher in small group time, etc.

In many instances, while some students are in small groups, the remaining students are doing some kind of seat or independent work that may not result in impactful learning. By devoting time to rotating small groups for the sake of having mandated daily small group time, students may actually be missing out on valuable instructional time and learning opportunities they need to become better readers. 

According to literacy expert Dr. Tim Shanahan, teachers should maximize the amount of learning opportunities that can be provided to students. This means do not group for the sake of grouping. Organize the day around what needs to be accomplished to achieve intended reading goals that center on helping students learn to decode (read) and encode (spell) text accurately, to read text fluently, to learn to comprehend and learn from text, and to compose text. Devote time to each of those goals and try to figure out the most powerful way — whole group, small group, or individual instruction at times — to reach each goal efficiently and effectively. 

Instruction organized in this way could look like teachers focusing heavily on whole class teaching, with small, flexible group and individual instruction aimed at reinforcing, extending, and ensuring that the whole class lessons stick. Flexible groups can be used to focus on different learning tasks that help students practice and master specific skills. 

Minimize grouping on the basis of reading ability level, at least beyond grade 1. 

Groups should be used to focus on mastering skills students actually need to work on with students moving fluidly in and out of groups as needed. Examples of this goal-oriented approach include: 

• To achieve goals around decoding: instruction could be whole class introduction of skills, with small group and individual follow up to ensure students get the specific skill that was taught. The small group work could be practice or reteaching.
• To achieve goals around fluency:  instruction might best be organized in pairs with the teacher moving among these pairs and monitoring progress.
• To achieve reading comprehension goals:  instruction might be a mix of whole class and small group teaching depending on the specific situation and skills to be mastered.
• To achieve writing goals: instruction might be whole class with some individual follow up, and so on.

References

Education Week, Classroom Reading Groups: 5 Lessons From Recent Studies.

Shanahan on Literacy, Should Reading Be Taught Whole Class or Small Group?.

Reading Rockets, Shanahan, To Group or Not to Group, That Is the Question.