How Child Care Center Owners Can Utilize the Workforce Innovation and Opportunity Act (WIOA)

The child care industry faces a severe workforce crisis. In fact, more than 150,000 workers are “missing” compared to pre-pandemic projections. As a result, staffing shortages keep getting worse. For child care center owners, the Workforce Innovation and Opportunity Act — known as WIOA — offers powerful tools to recruit, train, and retain staff at little to no cost.

What Is the Workforce Innovation and Opportunity Act?

The Workforce Innovation and Opportunity Act (WIOA) is a federal law signed in 2014. It governs how the United States delivers workforce development services. Specifically, it replaced the Workforce Investment Act of 1998. It also represents the first major reform of the public workforce system in over 15 years.

WIOA helps job seekers access employment, education, training, and support services. State and local governments administer the law through American Job Centers (AJCs). These centers serve as one-stop resources for career counseling, job training, and employer services.

Additionally, WIOA requires states to align their workforce programs through combined four-year state plans. This promotes accountability, transparency, and regional collaboration. Most importantly, the Workforce Innovation and Opportunity Act doesn’t just serve job seekers. It also provides significant benefits for employers, including child care center owners who need skilled workers.

As of early 2026, Congress has not formally reauthorized WIOA. However, FY2026 funding was preserved through the Consolidated Appropriations Act signed on February 3, 2026. The system continues to operate under existing law and expanded waiver flexibility for states.

Why the Workforce Innovation and Opportunity Act Matters for Child Care

The child care sector lost roughly 370,000 jobs between February and April 2020. Recovery has been painfully slow. By the end of 2023, there were still 40,000 fewer child care workers than before the pandemic. Furthermore, the National Women’s Law Center calls this decline “alarming.” These shortages existed well before COVID-19 and have only worsened since.

Meanwhile, state licensing rules increasingly demand credentialed staff. Parents expect more qualified caregivers than ever. On top of that, universal childcare initiatives across multiple states are driving massive new workforce demand. Experts estimate the industry will need 73,000 additional qualified workers by 2027.

As a result, the Workforce Innovation and Opportunity Act provides both a framework and funding to help center owners tackle these challenges. Understanding these workforce pressures is one of the 10 major childcare management challenges every owner should prepare for.

On-the-Job Training: Get Reimbursed for Training New Hires

One of the most valuable WIOA programs for child care owners is On-the-Job Training (OJT). Through OJT, you hire a WIOA-eligible participant and train them on the job. In return, WIOA reimburses a portion of your wage costs during the training period.

The reimbursement rates favor small businesses — which most child care centers are:

Employer Size	Maximum Reimbursement Rate
1–19 employees (small)	Up to 75% of wages during training
20–99 employees (medium)	Up to 65% of wages during training
100+ employees (large)	Up to 50% of wages during training

In other words, a center with fewer than 20 employees could recover up to 75% of a new hire’s wages. WIOA staff customize each training plan to the role. They also conduct regular site visits to assess progress. Typically, OJT contracts cover full-time employment of 30 or more hours per week.

For example, OJT works well for bringing on classroom aides, assistant teachers, or support staff. You train them to your standards while reducing your payroll burden. Of course, you’ll want to maintain proper staff-to-child ratios and group sizes when planning around OJT participants.

Incumbent Worker Training: Upskill Your Current Staff

Already have a team you want to develop? The Workforce Innovation and Opportunity Act also offers Incumbent Worker Training (IWT). This program helps employers retain skilled workers and prevent turnover by funding training for existing employees.

Unlike OJT, incumbent workers don’t need to meet the same eligibility requirements. Instead, IWT focuses specifically on helping businesses keep their teams, avert layoffs, and support career advancement.

Moreover, the employer cost-share for IWT depends on business size:

Employer Size	Employer Cost Share	WIOA Covers
Up to 50 employees	As low as 10%	Up to 90%
51–100 employees	25%	75%
100+ employees	50%	50%

Therefore, a center with 50 or fewer employees could have WIOA cover up to 90% of training costs. This could include CDA credential prep, first aid certification, leadership training, or curriculum development courses.

In addition, employers must commit to retaining workers for at least six months after training. This creates a built-in retention incentive. For more retention ideas, check out our guide on creating true perks for childcare staff. You may also want to read about supporting your employees’ mental health.

CDA Credential Training Through WIOA Funding

The Child Development Associate (CDA) Credential is the most recognized credential in early childhood education. Fortunately, WIOA can cover the full cost of CDA prep programs through approved training providers.

Here’s what WIOA funding can cover for your staff:

• Tuition for CDA programs through WIOA Individual Training Accounts (ITAs)
• Books, materials, and exam prep costs
• Transportation and childcare support through WIOA supportive services
• Workers who earn a CDA can boost their hourly wage by 50% when moving into lead teacher roles

To illustrate, credentialed workers typically earn $15–$18 per hour. That’s up from $12–$14 for uncredentialed workers. By helping your staff earn CDA credentials through WIOA, you improve care quality and meet licensing requirements. You also give your employees a real career pathway — all with federal funding.

Similarly, CDA-credentialed staff strengthen your accreditation standing. Learn more about the path to NAEYC accreditation and how credentials support that process.

Registered Apprenticeships in Early Childhood Education

The Workforce Innovation and Opportunity Act also supports registered apprenticeships. These programs use an “earn and learn” model. Participants receive wages while gaining hands-on experience and working toward credentials.

Notably, the CDA credential maps directly to the Department of Labor’s apprenticeship standards for both Child Care Workers and Preschool Teachers. Several states have already seen strong results:

• In Illinois, 12 Spanish-speaking staff earned CDA credentials through a bilingual cohort. The center saw a $45,000 annual revenue increase through quality improvements.
• In South Carolina, emergency WIOA funding for 7 apprentices restored community childcare capacity 6 months ahead of schedule.
• In Louisiana, 28 providers received training across 4 parishes through post-disaster workforce rebuilding.

Best of all, apprenticeship programs offer 100% funding for approved training. They also provide stackable credentials, wraparound services, and no payback requirements upon completion.

Becoming a WIOA Eligible Training Provider

Some child care center owners also operate training programs. If that describes you, consider applying to become a WIOA Eligible Training Provider (ETP). Under the Workforce Innovation and Opportunity Act, all ITA-funded classroom training must come from organizations on the state’s Eligible Training Provider List (ETPL).

To qualify, your organization typically needs:

• Accreditation or state approval
• Compliance with WIOA non-discrimination rules
• A valid business license
• Insurance coverage
• Demonstrated training outcomes

Once approved, you open a new revenue stream. Your center receives WIOA funding when eligible participants enroll in your program. In essence, you turn your staff development expertise into a business line. This is yet another way to increase profitability for your childcare business beyond tuition revenue.

How to Connect With Your Local Workforce Board

The Workforce Innovation and Opportunity Act operates through local Workforce Development Boards (WDBs) and American Job Centers. Private business representatives lead these boards. In fact, at least 51% of members must come from the private sector.

Additionally, WIOA allows child care organizations to join local workforce boards. You can help write local plans and serve as a partner at One-Stop Career Centers. As a result, you can shape local workforce policy and advocate for early childhood education priorities.

Here’s how to get started:

1. Find your local American Job Center using the CareerOneStop Finder or call 1-877-US-2JOBS
2. Ask about OJT and IWT employer programs and reimbursement rates
3. Identify WIOA-approved CDA or ECE training providers in your state
4. Consider joining your local Workforce Development Board
5. Explore registered apprenticeship programs through Apprenticeship.gov

The Work Opportunity Tax Credit: A Complementary Benefit

The Work Opportunity Tax Credit (WOTC) isn’t part of the Workforce Innovation and Opportunity Act directly. However, it often works alongside WIOA programs. WOTC gives employers a federal tax credit for hiring people from targeted groups who face employment barriers.

For instance, child care center owners who hire TANF recipients, veterans, or long-term unemployed workers can claim up to $2,400 per hire. For long-term TANF recipients, the credit reaches $9,000 over two years. To claim it, you must pre-screen applicants using IRS Form 8850 on or before the job offer date.

Even better, you can combine WOTC with WIOA OJT reimbursements after the OJT contract ends. Just file all WOTC paperwork before the hire date. Together, these benefits substantially cut your hiring and training costs. For more tax strategy, see our end-of-year guide to tax write-offs for childcare centers.

Workforce Pell Grants: A New Opportunity Starting July 2026

Workforce Pell is a major new development in federal workforce policy. Starting July 1, 2026, Pell Grant eligibility expands to cover high-quality, short-term training programs. Consequently, this opens new funding for CDA prep and other early childhood certificates.

Child care center owners should monitor this rollout closely. It could provide yet another funding pathway for staff training. To stay ahead, begin reviewing eligibility and reporting standards now. Keeping up with federal and state-level funding decisions is critical for positioning your center to benefit.

Practical Steps for Child Care Center Owners

You don’t have to navigate the federal bureaucracy alone. Many approved training organizations handle all WIOA paperwork. They also coordinate with local workforce boards on your behalf.

Here’s a streamlined path to get started:

1. Contact a WIOA-approved ECE training provider or your local American Job Center
2. Screen your staff for eligibility — many child care workers qualify as “underemployed” at around $12 per hour
3. Complete WIOA applications with help from your provider or career counselor
4. Enroll staff in approved training using online, evening, weekend, or hybrid options
5. Track outcomes like credential completion, wage increases, and retention rates

The process works in your favor. Centers train their workforce using federal dollars. They improve care quality and meet regulatory requirements. They reduce turnover — all at little to no direct cost. Tracking important KPIs will help you measure the impact of WIOA on your business.

The Bottom Line for Child Care Center Owners

The Workforce Innovation and Opportunity Act remains one of the most underutilized resources for child care business owners. Consider the benefits: OJT reimburses up to 75% of wages for small employers. IWT covers up to 90% of training costs. CDA programs can be fully funded. Apprenticeship pathways cost you nothing. And WOTC adds even more tax savings on top.

The child care workforce crisis shows no signs of slowing down. Therefore, center owners who proactively leverage WIOA programs gain a clear advantage. They attract better candidates, develop more qualified staff, and build a stronger business. If you need help understanding how these programs affect your finances, Honest Buck Accounting specializes in early childhood education businesses. We keep your books, taxes, and strategy on track as you grow your team.