An Early Education Workforce Tax Credit
Goal: To strengthen and grow Wisconsin’s workforce now and prepare our workforce for the future.
Recommendation: A Refundable Tax Credit for the Earl rly Care and Education Workforce To strengthen and grow Wisconsin’s workforce now and in the future, we need to make it possible for more people to enter the workforce. Early education is the most effective vehicle to do this because when we increase access to stable, high- quality early education, more of Wisconsin’s talent can join the broader workforce. We create access to early education by growing a stable workforce of early educators and incentivizing our qualified early educators to stay in the industry. A refundable tax credit for the early education workforce is the tool to make this happen.
Urgency: The Earl rly Care and Education In Industry ry is in Crisis “A teacher with an Associate Degree in Early Childhood Turnover is Education can expect to start at $10.00 per hour and will rarely occurring at a make more than $13.00 – compared to $18.57 per hour for rate of 36% others in the state workforce who hold an associate degree. The gap for a bachelor’s degree is even larger.” (Wisconsin’s Child Care Workforce, 2016)
Why a Tax Credit? Center for Economic Development
Evidence: This Approach Works “By laying the crucial groundwork for tomorrow’s workforce and supporting a strong workforce today, high-quality childcare builds our nation’s human capital two generations at a time.” (Workforce of Today, Workforce of Tomorrow Report) & Economic Development School Readiness
In 2014, the average Louisiana’s Model tax credit for members of the workforce was ↑ Participation in QRIS $2,150. ↑ Quality of Child Care ↑ Amount of Professional Development Accessed ↑ Qualifications of Workforce
A Strong Foundation “Because the child care industry is composed of • YoungStar largely of small businesses, it • Well-Educated makes sense to use tax credits as a way for the government • The Registry to invest in economic • Tax Credits development.” (Giving Credit Where It’s Due Report)
Who is Eligible? Early Educators who meet the following: • Have achieved a Level 12 of higher in The Registry • Have worked in their program for 12 months or more • Have had their employment verified by their program through The Registry • Work in a program rated 3, 4 or 5 Stars • Inclusive of various roles: family child care, teachers, assistant teachers, directors
The Investment • Based on Individual Qualifications in The Registry
Proposed Tiers Based on Career Level Proposed Tier Alternative #1 Alternative #2 Career Level 12 (2,785 Early Educators) $2,000 credit $ 5,570,000 $1,500 credit $ 4,177,500 $2,500 credit $ 6,962,500 Career Level 13 (579 Early Educators) $3,000 credit $ 1,737,000 $2,500 credit $ 1,447,500 $3,000 credit $ 1,737,000 Career Level 14 & Above (2,774 Early Educators) $4,000 credit $ 11,096,000 $3,500 credit $ 9,709,000 $3,500 credit $ 9,709,000 Total (6,138 Early Educators) $ 18,403,000 $ 15,334,000 $ 18,408,500
What does this do for compensation? Approximate Median Proposed Percent Increase Hourly Wage Starting Wage Credit to Compensation Increase Career Level 12 $10 $2,000 credit 9.6% $0.96 Career Level 13 $11 $3,000 credit 14.4% $1.44 Career Level 14 & Above $12 $4,000 credit 19.2% $1.92
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