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Transforming the Financing of Early Care and Education (2018)

Chapter: 3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)

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Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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3

Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)

As described in Chapter 2, early care and education in the United States is funded in a variety of ways, with funding from both public and private sources. These funds are distributed through financing mechanisms, defined here as methods by which funds are distributed to entities, including providers, families, and the early care and education (ECE) workforce, in order to support the provision of early care and education. These financing mechanisms have consequences for the accessibility and quality of ECE programs. The ways in which funds are distributed and to whom can have effects on which children are served, which families benefit, and whether the care delivered is of high quality, as well as affecting the well-being and qualifications of the ECE workforce. All of these factors ultimately affect the development and well-being of the children served. Financing mechanisms may be provider oriented, family oriented, workforce oriented, or systems oriented. For example, financing that is designed to offset the cost of service delivery may be distributed directly to a provider, or financing that is designed to support pursuing credentials and other professional qualifications may be paid directly to ECE professionals. Provider-oriented financing mechanisms, family-oriented financing mechanisms, workforce-oriented financing mechanisms, and system-oriented financing mechanisms are described in Box 3-1.

In Chapters 3, 4, and 5, the current ECE financing mechanisms are analyzed with respect to the criteria that the committee developed in light of the six principles of high-quality early care and education set out in Chapter 1. The six principles with the criteria derived from them are shown in Box 3-2. In each of the three chapters, the committee discusses the advantages

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×
Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×
Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×
Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

and disadvantages of the existing financing mechanisms and assesses the mechanisms against the criteria. This chapter examines the committee’s first principle: High-quality early care and education requires a diverse, competent, effective, well-compensated, and professionally supported workforce across the various roles of ECE professionals.1

A highly qualified ECE workforce is essential to the provision of high-quality early care and education. For a workforce to be well qualified, educators and staff need to be well compensated, have affordable opportunities to access higher education, and receive appropriate ongoing support and professional development. This section explores the various mechanisms of financing a highly qualified workforce, at both the service delivery and system levels. It examines three workforce-specific aspects of early care and education: compensation; onsite staff supports and professional development; and system-level workforce development supports, including higher education and ongoing professional learning. Financing mechanisms to support the workforce can be directed either at providers or at individuals entering or already in the ECE workforce, or they may be directed at other entities such as institutions of higher education or nonprofit organizations that provide workforce development activities.

IMPROVED COMPENSATION

Despite an increased emphasis on raising the qualifications and education level of ECE educators over the past two decades, there has not been a commensurate emphasis on raising the compensation of the workforce. The ECE workforce is paid at significantly lower levels than other professionals with a similar level of education (National Survey of Early Care and Education Project Team, 2013). Compensation for the ECE workforce, as compared to the civilian labor force as a whole and to other elementary educators, is shown in Figure 3-1. In addition, benefits for ECE professionals are limited, and these professionals are often expected to meet their professional responsibilities during unpaid hours (Institute of Medicine and National Research Council, 2015, p. 466). As a result, many ECE professionals are economically insecure and must rely on federal income supports to sustain themselves and their families. According to data from the American Community Survey (2007–2011), ECE professionals participated in public support programs at state-level rates ranging from 30 percent

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1Chapter 4 discusses the committee’s second principle that all families must have equitable access to affordable, high-quality early care and education, and Chapter 5 discusses principles 3 through 6, which focus on ensuring high-quality service delivery across a variety of settings.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×
images
FIGURE 3-1 Compensation for the ECE workforce, 2012.
NOTES: Annual wages calculated by multiplying the hourly mean wage by 40 hours per week, 52 weeks per year. ECE = early care and education.
The wages are based on 1,360,380 elementary school teachers and 157,370 kindergarten teachers (Bureau of Labor Statistics, 2014).
Data from National Survey of Early Care and Education Project Team (2013, Table 17).
SOURCE: Institute of Medicine and National Research Council (2015, p. 467) (adapted from Whitebook, Phillips, and Howes, 2014). Reprinted with permission from the Center for the Study of Child Care Employment, Institute for Research on Labor and Employment, University of California, Berkeley.
Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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(Minnesota) to 59 percent (New York).2 This economic insecurity, with its many stressors, undermines the ECE workforce’s ability to provide quality care for young children (Bueno, Darling-Hammond, and Gonzales, 2010; Whitebook, Phillips, and Howes, 2014). See Chapter 1 for further discussion of the current financial insecurity of the ECE workforce.

Moreover, as reported in the Transforming report, benefits for the ECE workforce are limited and vary greatly by job title and ECE setting (National Research Council, 2012, pp. 134-138).3 For home-based providers in particular, it is uncommon for ECE professionals to receive paid benefits (Child Care Services Association, 2012).

Inadequate compensation also contributes to instability in the workforce. According to Whitebook, Phillips, and Howes (2014), nearly one-third of ECE practitioners who have left Head Start jobs have done so because of inadequate compensation.4 In 2012, the mean turnover rate for ECE educators in centers was 13 percent (which varied by type of center from a 27 percent turnover rate for educators working in for-profit centers to an 8 percent turnover rate for educators working in religious organization–sponsored not-for-profit centers) compared to a less than 8 percent turnover rate for kindergarten through grade 12 (K–12) educators (Whitebook, Phillips, and Howes, 2014, p. 30; Goldring, Taie, and Riddles, 2014, p. 6). This instability in the workforce can decrease the quality of ECE services by disrupting the continuity of care for children, inhibiting quality improvement, and increasing program costs (Whitebook, Phillips, and Howes, 2014).

The Transforming report concluded that requirements for higher levels of education and competencies must be linked with fair compensation in order to recognize the professionalization of the ECE workforce and promote workforce recruitment and retention (Institute of Medicine and National Research Council, 2015, p. 478). Turnover of the ECE workforce,

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2 The 2007–2011 America Community Survey measured annual program participation rates in public support programs (the Earned Income Tax Credit, Medicaid, Medicaid/Children’s Health Insurance Program, and food stamps [the Supplemental Nutrition Assistance Program]) for families of ECE professionals (Whitebook, Phillips, and Howes, 2014, p. 90).

3 Thirty-one percent of center-based ECE practitioners had access to health care benefits according to data from the 2010 Bureau of Labor Statistic’s National Compensation Survey, compared to 60 percent of practitioners working in elementary and secondary schools. Similarly, only 30 percent of center-based employees and 47 percent of prekindergarten educators had access to retirement benefits, as compared to 69 percent of employees in all industries (National Research Council, 2012).

4 According to Kaplan and Mead (2017, p. 14): At the time of the 2007 reauthorization, Head Start teacher turnover was 11 percent annually. In the last eight years, turnover has increased to 16.5 percent. Among Head Start teachers who leave, 33 percent report leaving for higher compensation. For the last three years, Head Start has lost over 6,000 teachers during each school year, and this only reflects teachers who leave during the school year.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

like workforce turnover in other settings, also carries costs, as providers incur additional costs for hiring and training of new employees (Whitebook and Sakia, 2004).

Given that ECE compensation is low and stagnant, relative to growth in compensation for other occupations, adequate compensation linked to qualification requirements is needed (see, e.g., Blau, 2000; Institute of Medicine and National Research Council, 2015). Three main mechanisms for raising compensation are available: provider-oriented and family-oriented financing mechanisms aimed at increasing base pay, and workforce-oriented financing mechanisms in the form of wage supplements and tax credits. The advantages and disadvantages of each mechanism, with respect to the committee’s first principle, are discussed below.

Provider-Oriented and Family-Oriented Mechanisms

Increasing base pay can be done through contracts between funders and providers (a provider-oriented financing mechanism) that set compensation levels or compensation parity requirements. While this is the most direct way to guarantee that ECE professionals are adequately compensated, initiatives to increase base pay are “rare within the early childhood field” (Whitebook, McLean, and Austin, 2016). New Jersey’s, Oklahoma’s, and Alabama’s prekindergarten programs are exceptions where compensation stipulations have been built into the programs. In New Jersey, the state-implemented regulations require that school districts ensure that compensation for lead educators and assistant educators in Head Start settings and private providers under contract is comparable to that of K–12 educators or educator assistants employed by the school district. In Alabama, prekindergarten educators across settings receive the same starting salary and receive annual raises in line with the raises for K–12 educators (McLean, Dichter, and Whitebook, 2017). Likewise, the military ECE program (see Box 2-1 in Chapter 2) benchmarks compensation to the federal pay scale, ensuring parity with other similarly qualified professionals.

These programs are making strides to increase compensation for their workforce, and a growing number of programs, especially state-funded prekindergarten programs are pursuing this approach (Barnett and Kasmin, 2017). Conversely, publicly funded programs such as Head Start and CCAP have largely dealt with improved compensation as an add-on rather than as a cost of the service, or they have ignored the issue all together. Individual Head Start programs set their own salaries, with no ongoing policy or guidance from the federal government and only sporadic allocation of additional federal funds for compensation. Federal funding for wage increases for Head Start educators was allocated in the mid-1990s, but compensation for Head Start educators has not been directly addressed since then, despite

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

raising the requirements for education level and qualifications of the Head Start workforce. Head Start pay levels for baccalaureate-level educators are substantially below pay for baccalaureate-level educators in school-sponsored ECE programs and even further below the average salaries of other occupations that require a baccalaureate-level degree (Whitebook, Philips, and Howe, 2014). State initiatives on ECE workforce compensation through the Child Care and Development Fund (CCDF) have similarly employed add-ons to deal with the problem of inadequate compensation, using quality set-aside funds to enhance compensation, rather than integrating improved compensation for the workforce into the cost of providing early care and education (Kaplan and Mead, 2017). Moreover, family-oriented mechanisms, particularly tax preferences, are not well suited to improving the compensation and qualifications of the workforce. While tax preferences can help relieve the financial burden on families, this does not translate to additional money in the system for supporting the workforce.

Workforce-Oriented Mechanisms

Workforce-oriented mechanisms distribute funds directly to the workforce. Workforce-oriented mechanisms that attempt to periodically improve the compensation of the ECE workforce include wage supplements and tax credits (neither of which lead to lasting and stable increases in compensation).

Wage Supplementation

Wage supplementation strategies—methods for delivering compensation for employment that is in addition to regular, ordinary wages—have also been used to increase the compensation of the ECE workforce (Whitebook, McLean, and Austin, 2016). Wage supplementation is often designed to complement higher education or professional training of the workforce, in that the supplements are aimed at preventing workforce attrition once ECE educators earn higher-education credentials. Wage supplementation may also be intended to promote stability in the ECE workforce by rewarding educators who remain employed by their center for specified time periods (e.g., every 6 months). Wage supplementation awards vary by type of payment and method of dispersion. Some states pay participating ECE educators directly (see Box 3-3 for one example), while others entrust ECE centers with distributing funds to their employees (Mitchell, 2012). In addition to cash awards, wage supplements can be allotted in the form of better employee benefits. For example, employees of ECE centers that participate in higher-education plans, such as North Carolina’s Teacher Education and Compensation Helps (T.E.A.C.H.) program, may be eligible for lower-cost group health insurance programs (Child Care Services Association, 2017b).

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

Although wage supplementation is the most common strategy for increasing compensation, there are several disadvantages to how it has been implemented to date, in terms of ensuring the well-being and adequate compensation of the ECE workforce. First, the typical amount of current supplements is low and not sufficient to raise compensation levels to levels adequate for supporting recruitment and retention of a highly qualified ECE workforce. For example, the Child Care WAGE$ Program described in Box 3-3 provided an average of about $1,700 per educator in 2016 (T.E.A.C.H. Early Childhood National Center, 2016). Moreover, current wage supplements are not at levels high enough to give ECE professionals economic security, which adversely affects their well-being and their ability to deliver quality services to the children in their care (Whitebook, McLean, and Austin, 2016).

Second, wage supplements are used by less than one-third of states (15 states in 2012) and reach less than 2 percent (or 28,688 professionals) of the workforce in 2012 (Administration for Children and Families, 2013a). Moreover, they are usually restricted to particular groups of ECE professionals in the state: only those making below a certain amount or working

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

in particular programs or only those who meet particular education and training requirements. In their current form, they are therefore insufficient to address the needs of all ECE professionals.

Third, over time, wage supplements may replace the amount of compensation increase a provider would have paid in response to inflation and labor market demands (often referred to as “fiscal substitution”) and thus ultimately may not result in a net increase in compensation (Brandon and Scarpa, 2006). Finally, because funding for supplements is an add-on to ECE budgets, it is vulnerable to budget cuts and economic downturns, making it difficult to recruit and retain professionals who cannot rely on insecure funds when making employment decisions.

Tax Credits

Another method for increasing the net value of compensation to the ECE workforce is the use of state tax credits. Both Louisiana and Nebraska use this approach to supplement wages, rather than offering cash awards. Louisiana’s system offers refundable tax credits for ECE professionals. To be eligible, ECE professionals must work in centers that participate in the state’s quality rating and improvement system, and the benefit is offered as a refundable credit. When originally implemented in 2008, the credits ranged from $1,500 to $3,000, based on the ECE professional’s level of education; the amount has increased annually based upon the consumer price index (Mitchell, 2012). The main priority of the program is retention; specifically, to encourage highly qualified ECE professionals to work in lower-rated programs in order to close the quality gap among centers (Louisiana Department of Education, 2017b).5

Similarly, Nebraska’s refundable tax credit is available to professionals who have attained the minimum qualification of a child development associate (CDA) credential and who are employed by a provider that participates in the state’s Step Up to Quality program.6 In addition, professionals must participate in additional ECE professional development to get the credit. The amount of the credit ranges from $500 to $1,500 (Nebraska Department of Education, n.d.).

Though these tax credit initiatives provide financial benefits for some ECE professionals, again, implementation of tax credits for ECE

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5 While the tax credits aim to increase compensation for the ECE workforce, they have also incentivized and assisted in the attainment of credentials for ECE practitioners in the states. Since the establishment of the tax credits in 2008, the number of ECE professionals in Louisiana engaged in professional development activities has increased from 1,247 to 5,853, and the number of ECE professionals that strengthened their credentials increased from 284 to 2,156 (Louisiana Policy Institute for Children, 2016).

6 The Nebraska program is capped at a certain level and is scheduled to sunset. Therefore, it may not be available to eligible ECE professionals in the state.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

professionals is limited. The example of Louisiana indicates that refundable tax credits for ECE professionals is a valuable strategy for increasing qualifications among the ECE workforce, but the amount of the currently available credits is low and while providing some financial relief do not make up for low base wages. For example, the median wage for ECE professionals in Nebraska was $9.43 per hour in 2015, and the median wage for preschool educators was $15.31. Nebraska’s maximum tax credit is $1,500, or less than an additional dollar per hour for those working full-time (Center for the Study of Child Care Employment, 2016). Moreover, the credits do not increase monthly take-home pay; rather, professionals must wait until the end of the tax year to access the funds.7 However, as compared to wage supplements, tax credits might provide greater stability in that they could be designed so as not to be subject to the vagaries of annual appropriations, and legislative changes to the tax code itself would be required to dissolve the tax credits. Greater stability allows professionals making career decisions or students choosing a career path to rely upon more dependable components of total compensation as a factor in their decision making.

Summary: Improved Compensation

In sum, efforts to date have been inadequate to increase the compensation of ECE professionals to levels equivalent to the compensation of peers with similar education in other occupations. Financing mechanisms such as wage supplements and tax credits, while useful for temporarily providing some financial relief to some ECE professionals, do not markedly change the underlying base salary that the ECE workforce receives. In addition, most of the existing programs are small relative to the size of the workforce and limited to a specific subset of ECE professionals.

Raising base pay for the ECE workforce through contracts is the most direct way to ensure that adequate compensation reaches them and provides a predictable and steady increased annual salary for prospective and current educators. However, current efforts to raise base pay are constrained by insufficient levels of funding for direct service delivery. Moreover, compensation levels for ECE educators are already highly variable across funding streams, ages of the children served, and center- or home-based settings; mechanisms that raise compensation for only some of the ECE workforce may exacerbate these differences, rather than ameliorating them. Effective mechanisms for improving compensation across the board are needed.

In a field with a largely non-unionized workforce and a substantial for-profit sector, it is unlikely that the labor market for ECE educators will

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7 Of course, some professionals may prefer annual lump-sum credits for financial planning purposes, as these lump-sum amounts may be easily invested to improve long-term financial sustainability such as making a down payment on a car or home.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

adjust upward due to a few targeted mechanisms that supplement compensation in specific programs, absent some standards or guidelines related to the distribution of funds to the workforce. What is needed is implementation of policies that ensure adequate compensation, while ensuring that costs do not fall on already overburdened families.

ONGOING PROFESSIONAL LEARNING AND HIGHER EDUCATION

Improving the knowledge and competencies of the ECE workforce requires access to affordable, high-quality preservice training, including higher education, for those entering the field, as well as high-quality ongoing professional learning and training for the incumbent workforce.8 Onsite professional learning and professional development supports are financed at the service delivery level, while additional workforce development supports and financing for system-level workforce development supports—including ongoing professional learning and higher education—are financed at the system level. As noted above, in the current system the cost of direct service delivery does not adequately cover these components. Instead, payment for direct service delivery covers basic, day-to-day early care and education, with often inadequate funds carved out for workforce supports.

In the sections below, the committee reviews the financing mechanisms currently available to support the professional development of the ECE workforce—through higher education and ongoing professional learning—and examines whether these mechanisms facilitate the development and support of a highly qualified workforce by increasing affordability and access to high-quality training and education and whether they promote the maintenance or creation of a diverse workforce across job roles.

Higher Education

This section reviews the workforce-oriented and system-oriented financing mechanisms available to the ECE workforce to pursue higher education credentials. While pursuit of bachelor’s-level degrees or higher is important for lead teachers, the Transforming report also emphasized the need to build pathways toward this qualification. For this reason, financing to support ECE professionals in pursuing CDA credentials, associate’s

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8 Currently, the educational backgrounds of the ECE workforce vary greatly across settings, ranging from educator staff with limited formal education to educator staff with bachelor’s degrees or higher. According to Whitebook, McLean, and Austin (2016, p. 31), “people of color are disproportionately concentrated in lower-status and lower-paying jobs in certain settings and have limited representation in administrator and director roles or in lead educator and other team-leadership roles” (see also Chapter 1).

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

degrees, and other professional credentials is important. Box 3-4 describes examples of innovative supports for strengthening the qualifications of the ECE workforce and building pathways toward a BA-level degree, and Box 3-5 describes ways in which the workforce development system can be used to support the development of the ECE workforce.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

Workforce-Oriented Financing Mechanisms

Although the committee recognizes that a number of financing mechanisms are available to the general public to pursue higher education—and thus a number of prospective or incumbent ECE professionals are likely to qualify for these mechanisms—the committee has focused on the current financing mechanisms specifically targeted to support the ECE workforce, and we discuss them first below. We then provide an overview of some of the general higher-education supports that may be available to an ECE professional and discuss the strengths and weaknesses of these nontargeted supports as they apply to prospective or current ECE professionals.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

Higher-education support specifically targeting the ECE workforce. Currently, funding to support higher education for the ECE workforce comes from a variety of sources, including federal, state, and institutional aid programs. Funds are distributed specifically to the ECE workforce through financing mechanisms such as student loans, grants and scholarships, and tax preferences. Provider-oriented mechanisms may also include funds to support staff members’ pursuit of higher education, though these are rare in the current system. Part of Head Start’s training and technical assistance set-aside funds, for example, have been used to provide resources to ECE educators to attend college. For many in the ECE workforce who do not have the resources to pay for higher education out of pocket, the availability of these financial resources is critical. At the same time, improving the

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

earnings and employment prospects of this group is necessary to justify the financial costs required to complete a degree. To date, however, increasing one’s educational qualifications has not produced markedly higher compensation for ECE educators (see the discussion in the section above on “Improved Compensation”).

Even so, many ECE educators who do attain additional credentials have taken on student-loan debt to do so. While the amount of debt varies tremendously by school and program of study chosen, U.S. Department of Education data on certain ECE-relevant bachelor’s degree programs at for-profit colleges suggest that annual per-student debt payments fall between $1,349 and $2,813. This corresponds to between 6 percent and 9 percent of a student’s total annual earnings, or anywhere from 25 percent to 32 percent of discretionary income. Although students at public higher-education institutions are likely to take on much smaller debt loads due to their lower tuition levels at these institutions than the for-profit colleges, increasing demand for bachelor’s degrees among the ECE workforce could also trigger expanded enrollments at the for-profit institutions. This change could result in a net increase in the total debt load for ECE professionals, unless additional scholarships and other financial supports are made available.

Available ECE-workforce-oriented financing mechanisms are inadequate to systematically transform this workforce. While a number of programs support the educational attainment of the ECE workforce, they are limited in scale. For example, the T.E.A.C.H. scholarship program9 provides financial assistance for current ECE educators and operates in 23 states and the District of Columbia with the support of a variety of partners (including United Way, foundations, and corporate sponsors) and both public and private funding sources (including CCDBG funds, Race to the Top Early Learning Challenge grants, and local and state general funds).10 Although the structure of the program is generally similar across states, the amount of support given to the workforce and the total funding varies by state. For example, in Wisconsin T.E.A.C.H. provides 75 percent of the total cost of tuition and books, as well as reimbursement for 15

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9 These scholarships are another aspect of the T.E.A.C.H. program referenced in Box 3-3 above, which should not be confused with the federally provided TEACH grants discussed below as a general support for higher education.

10 To be eligible for a T.E.A.C.H. scholarship, educators must currently hold a high school diploma or General Equivalency Diploma, work for a licensed ECE provider, earn below a set hourly wage threshold, and work a minimum number of hours per week. Providers agree to allow release time to educators for class attendance, reimbursable at an hourly rate by T.E.A.C.H. The T.E.A.C.H program also pays for a percentage of the tuition not covered by outside aid at an approved college or university. Participating ECE professionals commit to remaining in their current center for a period of time following degree completion, while the provider for which they work commits to increase the professional’s wages upon degree completion.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

hours per semester at $12.50 per hour. Participating ECE professionals are required to pay 10 percent of tuition and 25 percent of cost for books and to remain in the center for which they were working for a year following degree completion. The center for which they work is required to fund 10 percent of tuition, as well as a 2 percent pay raise upon the individual’s completion of the degree program. Costs of scholarships for family-based ECE providers are shared at a 90 percent to 10 percent split. A noteworthy point is that Wisconsin operates a waitlist for this T.E.A.C.H. scholarship program, indicating that demand exceeds available funding. The proportion of the Wisconsin ECE workforce served by the program is small.

Targeted financing mechanisms to support professionals with culturally, linguistically, and professionally diverse backgrounds in their pursuit of higher education are important to reducing the racial and ethnic stratification present across job roles in the current ECE workforce. Existing research literature has documented that adult students who are also working full time and students who are the first generation of college entrants in their families may need additional supports to achieve their higher-education goals (see, e.g., Dennis, Phinney, and Chuateco, 2005; Flores, 2014; Perna, 2010; U.S. Department of Education, 2010; Whitebook et al., 2013). Programs with such features as financial aid, flexible class schedules, and paid release time to attend classes, among others, may be more likely to help reduce stratification of the ECE workforce by ensuring success for those ECE professionals who undertake improving their educational qualifications (see Box 3-6). The T.E.A.C.H. scholarship program has a number of these features, and participation in the program is diverse. In this way, T.E.A.C.H. scholarships may help to disrupt stratification of the ECE workforce by creating opportunities to access education and achieve educational goals, though as noted above, the program is limited in scale.

General higher education supports available to the Early Care and Education workforce. Direct federal aid for higher education for students is almost entirely a voucher-based system, where money flows to students who are enrolled at their choice of school, field of study, and degree type. Financing is available to recent high school graduates, as well as to older students from all backgrounds, making it a good resource for aspiring ECE professionals, as well as the incumbent ECE educator hoping to advance her or his skills through higher education. The Federal Direct Loan program issued $93 billion to students and their families in 2017, many of whom would be unlikely to attain financing in the private market (U.S. Department of Education, Federal Student Aid, 2017). Loans are made to undergraduate students, the parents of undergraduate students who are still financially dependent upon their parents, and graduate students. The amount a student can borrow, as well as the interest rates and fees charged, vary according to the loan type.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×
Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
×

Student-loan debt has become controversial in recent years, as more students have taken on higher debt loads than has historically been true, leading many of these borrowers to struggle with loan repayment down the line (Miller, 2017). When considering student loan borrowing for all students, but in particular for those preparing for ECE career opportunities, it is important that student borrowing remains affordable relative to the student’s expected future earnings.

Income-driven repayment plans, now widely available to all federal student loan holders, cap borrowers’ monthly payments at a reasonable share of their income, with any outstanding balance forgiven after a specified number of years.11 For students pursuing career opportunities in early care and education, the existence of income-driven repayment plans can make federal student loans more affordable. However, unless earnings for ECE professionals rise, relying on student loans to fund new credential requirements is risky because students’ low earnings will make it difficult for them to pay off their loans in the future, creating costly burdens for taxpayers who will eventually cover a large share of the debt burden. Some community colleges have even expressed interest in limiting borrowing among students in particular degree fields, including early childhood education, because the anticipated postgraduation earnings are insufficient to enable these students to pay back student loans above some ceiling level (Barrett and Laitinen, 2017). If earnings rise to a level that justifies both the individual investment in higher education and the risks associated with borrowing for educational costs, relying on limited student debt to help finance the costs of education may become viable. In addition, for ECE professionals with Perkins loans, a portion of the loans may be forgiven for each year of teaching service, which includes many ECE positions. However, new Perkins loans are no longer authorized by Congress, so future students will not have this option.12

Many current ECE professionals may also be eligible for need-based grants and scholarships, including federal Pell grants and other state and institutional aid programs. The formula for distributing Pell grants is complex, but most families earning less than $50,000 are eligible to receive some Pell money, while those earning less than $20,000 are likely to receive the maximum grant amount. However, the amount of a Pell award may not cover the full costs of higher education; the maximum Pell award during the 2016–2017 school year was $5,815. The total number of semesters a student can use a Pell grant is capped at 12. To participate, students must

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11 See https://studentaid.ed.gov/sa/repay-loans/understand/plans/income-driven [December 2017].

12 See https://studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/perkins [December 2017].

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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take at least six credits per semester.13 These eligibility requirements may place barriers to access on the ECE workforce, as current practitioners may be unable to take the requisite number of credits while continuing to work.

Federal Teacher Education Assistance for College and Higher Education (TEACH) grants also provide supplemental funding to students who are in an education program and who plan to teach in a high-needs field in low-income schools. ECE educators who work in public schools that receive Title I grants are eligible to participate in the TEACH grant program. For students who fail to meet specified post-education employment criteria, their grant awards convert to a loan, the amount of which includes all accumulated interest from the time that grant amounts were disbursed. Given the high rates of loan conversion on these grants (U.S. Government Accountability Office, 2015), it may not be an effective model for encouraging employment in high-needs education positions.

The federal tax code also supports higher-education students through a variety of tuition tax credits and deductions, tax advantaged Coverdell and 529 college savings accounts, and the student loan interest deduction. Many of these tax provisions have been criticized because they do not lessen costs at the time tuition bills are due and are primarily used by upper-income and middle-class families (Delisle and Dancy, 2015). Research has found that because low-income students often have their tuition expenses fully covered by grants, and tax credits cannot be claimed for living expenses while enrolled, the tuition tax benefits favor high-income students or those who attend schools with higher tuition rates, despite being partially refundable tax credits (Congressional Budget Office, 2016; Dynarski, 2004). Some states have also set up their own tax provisions similar to those at the federal level.

State governments also support higher education in one of two forms: general-purpose appropriations that go directly to public 4- and 2-year institutions in the state, and state grant and scholarship programs to students. State appropriations to public institutions are used to offset tuition payments, making public community and technical colleges and 4-year colleges a more affordable option for students hoping to advance their skills and knowledge in ECE fields. However, due to a combination of declining state appropriations and increased enrollment in recent years, per-student state funding has declined in almost every state since the 2008 recession. After adjusting for inflation, total funding is also below pre-recession levels, though total funding has increased in recent years (Mitchell, Leachman, and Masterson, 2017).

Additionally, most states operate scholarship programs. These programs vary enormously with respect to the size of the award given to

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13 See https://www.scholarships.com/financial-aid/grants/federal-grants/ [December 2017].

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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students, whether they include grade point average or income eligibility cutoffs, and whether there are stipulations as to what schools or fields of study qualify. Because state grant programs contain many different requirements and often focus on providing scholarships to recent high school graduates, there are likely ways to restructure these programs to make them more widely available to ECE students. Some higher-education institutions also benefit from private contributions or endowment earnings, which can be used for a variety of purposes, including providing need- or merit-based scholarships to incoming or continuing students.

Further, with respect to paying for higher education, a lack of information about costs and financial aid often creates barriers to leveraging all the resources existing throughout the higher education system (Bennett, 2001). For example, the current federal aid application and disbursement cycles are incredibly complex, poorly timed, and difficult for prospective students to understand (Dynarski and Scott-Clayton, 2006; National Association of Student Financial Aid Administrators, 2013; Simons and Helhoski, 2016). An inaccurate understanding of financial aid could contribute to underconsumption of higher education, particularly among low-income families, as those families are most likely to cite cost or availability of financial aid as the most important factors in deciding whether to go to college (Fishman, 2015). Among the incumbent ECE workforce, this lack of awareness concerning the different financial supports available could lead both providers and staff to forego higher education opportunities due to misperceptions about the out-of-pocket costs, creating a barrier to leveraging existing resources to help support higher education among ECE professionals.

System-Oriented Financing Mechanisms

While the current financing structure provides some support to the ECE workforce to address the front-end costs of higher education, the available provider-oriented and workforce-oriented financing mechanisms, as currently structured, have largely remained agnostic on questions about quality and value of the higher education students receive. In general, quality in higher education as a whole is highly variable for students, with minimal quality assurance standards in place and little transparency about student outcomes across fields of study (see e.g., Brown, Kurzweil, and Pritchett, 2017). These quality issues in conjunction with the market-based structure of higher education—wherein students select what to study and where to enroll—enable low-quality programs to continue to access federal and other public funding sources and require students to make complex decisions with little reliable information on quality.

Across the system, current investments in higher education are not providing students with consistent high-quality programs; in the ECE field,

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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schools are not necessarily providing the skills and expertise necessary for working with young children. Moreover, higher-education programs for early care and education lack resources for program and faculty development (Institute of Medicine and National Research Council, 2015). Since 2008, state funding for public 2- and 4-year colleges has declined by nearly $9 billion (adjusting for inflation). According to Mitchell, Leachman, and Masterson (2017, p. 1), this overall decline in funding “has contributed to higher tuition and reduced quality on campuses, as higher education institutions have balanced budgets by reducing faculty, limiting course offerings, and in some cases closing campuses.” These cuts in funding to higher-education institutions make it difficult to build ECE-focused baccalaureate programs, to hire more faculty to meet student demand, and to keep tuition rates from increasing. The decline in funding for public higher education means that in addition to helping the current and future ECE workforce access funding to increase educational attainment, additional incentives may be necessary to ensure that these new degrees are of high enough quality to give the ECE workforce the skills and competencies necessary to do their work well.

ECE advocacy organizations such as the National Association for the Education of Young Children and the Division for Early Childhood evaluate quality in higher education programs of study for early childhood professionals.14 While the existence of such organizations can serve as a helpful signal of quality in some cases, taking on program-level accreditation can be costly to institutions, due to both accreditation fees and the costs associated with raising quality standards to the level required for accreditation. Unlike school-wide accreditation, program-level accreditation is not required to receive access to federal financial aid, nor is it necessarily incentivized or required by all states. This means that while program-level accreditation serves as a valuable marker of rigor for students interested in honing their ECE craft in a high-quality program, it is not sufficient unless there is also a state commitment to link teacher certification to program accreditation, in order to deter low-quality programs from offering ECE degrees. Additional incentives at the state or federal level are necessary to encourage schools to seek out program-level accreditation and to enable students to pursue degrees with program-level accreditation. Such commitments and incentives could help leverage existing quality assurance mechanisms and prevent low-quality programs from exploiting the increase in demand for credentials in ECE fields that stems from the increased emphasis on professionalizing

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14 The evaluated programs may be located within education departments or outside of them as the National Association for the Education of Young Children recently began accrediting early childhood programs located outside education departments.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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the ECE workforce. Box 3-7 describes recent efforts to address quality, not specific to ECE programs, in the higher-education field.

Summary on Higher Education

Despite increased awareness of the need to improve the foundational knowledge and skills and competencies of the ECE workforce, financial supports for higher education are generally provided only on a limited basis and, like financing for improved compensation, typically are not integrated into the financing of direct service delivery. While there are a variety of resources for students or ECE practitioners seeking higher education, most of the current financing mechanisms do not meet the needs of all ECE practitioners and are insufficient to overcome the barriers—including affordability, access, and availability—that face ECE educators pursuing education and training (see, e.g., Glazer et al., 2017). Moreover, these mechanisms are generally not targeted to reducing racial and ethnic stratification across job roles, which persists throughout the ECE workforce.

The existing mechanisms do not mitigate concerns about whether investment in education is worthwhile, given the low wages in the field. Relying on student loans to fund higher education for the ECE workforce is problematic if low earnings, even after completing a course of study, will make it difficult to pay off loans. Grants and scholarships are useful tools but often do not cover the full cost of education. In addition, if the earnings of the ECE workforce rise, higher wages will make incumbent practitioners ineligible for some general need-based programs.

None of these financing mechanisms addresses the quality of the higher education. While limited supports are available for the incumbent and prospective workforce to pursue higher education, financing is largely absent for system-level improvements focused on ensuring that higher-education programs prepare students with the knowledge and competencies necessary to work with young children. Without proper investment to ensure quality in higher-education programs, financing tuition assistance and other supports may do little to improve the quality of professional practice (see Institute of Medicine and National Research Council, 2015; Whitebook and Austin, 2015).

Moreover, with the increasing costs of higher education, greater attention than ever is being paid to the labor market potential of different career pathways, making the earnings question of even greater importance for the ECE field. Because recent high school graduates can pick from a wide array of schools, degree programs, and career pathways, creating an appealing work environment—including wages and benefits, working conditions, and opportunities for advancement over time—in the ECE field is critical

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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to attracting potential employees. Currently, the earnings prospects for ECE-focused baccalaureate and postbaccalaureate degrees are much lower than the prospects in all other fields, particularly for baccalaureate-degree candidates.

Ongoing Professional Learning

One of the more important, yet least emphasized, components needed for a high-quality ECE system is ongoing professional learning, or professional development. Professional development for both educators and administrators during ongoing practice, as well as business training for

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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providers, is critical to building the ECE workforce and ensuring the sustainability and viability of providers (see Box 3-8).15

Professional development may be financed at the service delivery, the system level, or both and can take place onsite or offsite. It can be delivered in an array of formats, including informally to groups of participants through workshops or short-term trainings and on a one-on-one basis through onsite

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15 Professional development opportunities may also include training to “recognize when children need specialized support for their socioemotional development, to provide that support directly and through linkages to specialized services, and to connect to multigeneration intervention approaches that take into account the mental health and well-being of the adults in children’s lives instead of viewing children in isolation” (Institute of Medicine and National Research Council, 2015, p. 275).

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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mentoring or coaching, among other formats. While “one-off” training sessions for the ECE staff of a center have often been routine,16 it is well established that these professional development offerings do not have an enduring impact on practice (Darling-Hammond, 1998; Yoon et al., 2007). Serial and sequential learning options and coursework from accredited institutions, on the other hand, have a higher likelihood of effectiveness for adult learning and practice. Consistently providing professional supports to staff and building professional capacity in a way that leads to better teaching will require significant increases in capacity (Kaplan and Mead, 2017).

Existing professional development supports for the ECE workforce reflect the under-resourced and piecemeal ECE system as a whole. Most states do not have a comprehensive system for professional development of the ECE workforce, and training requirements and access to professional development vary considerably by program and setting. Provider-oriented mechanisms such as Head Start and public prekindergarten typically have dedicated resources to support the professional development of their staffs, including paid release time and pedagogical leadership development.

About 2 percent of the overall Head Start budget is to be used “for the purposes of improving program quality.” At least 50 percent of all Training and Technical Assistance funding goes directly to local Head Start providers, who can use the money for “expanding staff qualifications; improving the skills educators need in order to promote language and emergent literacy skills…and other uses identified by and specific to each individual grantee” (Office of Head Start, 2016c). The other half of the Training and Technical Assistance funding goes toward the creation and management of national centers and regional specialists; these programs provide guidance, consistent information, and assistance to Head Start providers. The 2016 Head Start performance standards require Head Start programs to create systematic methods for workforce training and professional development, including coaching for educational staff. According to the requirements, at a minimum, these systems should assess strengths and needs for supports for educators and provide intensive coaching and research-based professional development (Administration for Children and Families, n.d.). In addition to these specific performance standards for professional development, numerous other Head Start provisions have implications for the types of skills and knowledge that Head Start educators need. For example, Head Start requires that programs use evidence-based teaching practices in order to support the growth of bilingualism and biliteracy.

Some state prekindergarten programs include supports for professional development built into the cost of service delivery, similar to supports

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16 According to the National Survey for Early Care and Education, 53 percent of center-based educators who reported participating in a professional development workshop reported that it was “one-shot” (National Survey of Early Care and Education Project Team, 2015a).

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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provided to educators in the public K–12 system. Georgia’s prekindergarten program pays for up to 1.5 hours per day and an additional 10 days a year to be used for staff development and training. The prekindergarten program for San Antonio, Texas, also provides robust supports for professional development as part of service delivery, including paid time for coaching and mentoring, 3 weeks of paid professional development prior to the school year, and weekly group learning sessions (McLean, Dichter, and Whitebook, 2017).

The family-oriented mechanism of CCDF also includes funds dedicated to “quality set-aside funding,” which supports professional development. The 2014 CCDF reauthorization requires states to spend a minimum on general quality activities, which increases from 4 percent of CCDF spending previously mandated to 9 percent by fiscal 2020. States must devote an additional 3 percent to quality activities for infants and toddlers (National Conference of State Legislators, 2016). Each fiscal year, the Administration for Children and Families reserves 0.25 percent of CCDF funds (mandatory, matching, and discretionary) for providing technical assistance to grantees. This funding is to be used for at least 1 of 10 approved quality activities, which includes “supporting the training and professional development of the child care workforce.” As of 2012, 55 states and territories offered some form of technical assistance to ECE providers (e.g., mentoring, coaching, and other types of nonfinancial support) through distributions from CCDF quality-directed funds (Administration for Children and Families, 2013a).17

While publicly funded programs have dedicated resources to support professional development, many private center- and home-based providers, if they are not accessing public funds, may have limited resources for professional development. As a result, these educators are more likely to participate in offsite training sessions and are less likely to have access to intensive, ongoing supports (Ullrich, Hamm, and Schochet, 2017).

Summary: Ongoing Professional Learning

Existing professional development supports for the ECE workforce reflect the under-resourced and piecemeal ECE system as a whole. Most states do not have a comprehensive system for professional development for the ECE workforce, and training requirements and access to professional development vary considerably by program and setting. Generally, state prekindergarten programs, Head Start, and CCDF provide funds for professional development, and in this way these programs support the development of a highly qualified workforce. However, the funding set aside from CCDF is for a multitude of quality improvement projects; professional development has to compete for resources with other potential uses of the

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17 Based on data from 356,866 individual ECE employees from 35 states/territories (Administration for Children and Families, 2013a).

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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funding. Without a centralized, coordinated financing structure for professional development, professional development tends to occur as isolated, “one-shot” sessions. The foundational knowledge and the skills and competencies acquired through professional development in these formats may not necessarily translate into progress toward advanced degrees or other professional credentials, which can be costly and unproductive to the ECE workforce. Aligning professional development with training and technical assistance systems could foster continuous quality improvement.

CONCLUSION

This section has considered whether current financing mechanisms facilitate the development and support of a highly qualified ECE workforce, whether they ensure the well-being and adequate compensation of that workforce, and whether they support the strengthening and development of that workforce, particularly promoting the maintenance or creation of a diverse workforce across job roles.

Adequate compensation of the ECE workforce is generally not accounted for in the cost of service delivery; instead, there are various programs and financing mechanisms to supplement ECE professionals’ wages. While these programs provide some financial relief to a small number of ECE professionals, the overall pay is still low, and the temporary nature of the supplements does not create the predictable and steady salaries necessary for recruiting and retaining a highly qualified workforce. More often than not, these poor wages are accompanied by limited benefits and workplace conditions that are not conducive to quality professional practice.

While financing to support ongoing professional learning—including higher education and professional development—is available for the incumbent ECE workforce, it is limited in scope and inadequate, given the needs of the current workforce. Financing higher education—despite specific qualification requirements in certain programs for educators—is almost entirely the responsibility of the entering or incumbent ECE educator, except to the extent that publicly funded institutional and student support is available. Federal loan and grant programs provide some assistance, but these mechanisms do not ensure the quality of the higher-education programs. In addition, financing is largely absent for system-level improvements to ensure that higher-education programs prepare students with the knowledge and competencies necessary to work with young children. Without proper investment to ensure quality in higher-education programs, financing tuition assistance and other supports may do little to improve quality in ECE professional practice. Financing for ongoing professional development also lacks coordination across programs, resulting in costs to the ECE professional who is unable to translate the skill and competencies acquired through professional development into credentials and advanced degrees.

Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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Suggested Citation:"3 Current Financing for Early Care and Education: Financing a Highly Qualified Workforce (Principle 1)." National Academies of Sciences, Engineering, and Medicine. 2018. Transforming the Financing of Early Care and Education. Washington, DC: The National Academies Press. doi: 10.17226/24984.
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High-quality early care and education for children from birth to kindergarten entry is critical to positive child development and has the potential to generate economic returns, which benefit not only children and their families but society at large. Despite the great promise of early care and education, it has been financed in such a way that high-quality early care and education have only been available to a fraction of the families needing and desiring it and does little to further develop the early-care-and-education (ECE) workforce. It is neither sustainable nor adequate to provide the quality of care and learning that children and families need—a shortfall that further perpetuates and drives inequality.

Transforming the Financing of Early Care and Education outlines a framework for a funding strategy that will provide reliable, accessible high-quality early care and education for young children from birth to kindergarten entry, including a highly qualified and adequately compensated workforce that is consistent with the vision outlined in the 2015 report, Transforming the Workforce for Children Birth Through Age 8: A Unifying Foundation. The recommendations of this report are based on essential features of child development and early learning, and on principles for high-quality professional practice at the levels of individual practitioners, practice environments, leadership, systems, policies, and resource allocation.

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