Challenges of Designing and Implementing Wage Increases for Early Educators

• In Event: Building a Sustainable Workforce: Strategies for Improving Compensation and Working Conditions for Early Childhood Educators

Abstract

Introduction/Background: Early care and education (ECE) is a high-skill, low-wage profession: when comparing median incomes, typical pay is at the third percentile among occupations in the United States (McLean et al., 2024). Despite high demand for ECE services, including preschool, program leaders are unable to raise wages due to their inability to raise prices and further burden parents. This broken system, where both parents and providers are squeezed, is considered a market failure as a result (US Treasury Department, 2021). 

Increasingly, states and localities are interested in intervening to directly increase wages through public and/or private dollars. Higher pay is linked to reduced teacher turnover (Whitebook and Sakai, 2003). Recently, there was a flurry of experimentation with funding drawn from the American Rescue Plan Act (Lee, 2025). Most wage boosts, however, were modest in amount and short-lived. In a few cases, however, states and counties are exploring long-term wage increases for early educators. This includes three Bay Area counties in California (Contra Costa, Alameda, and San Francisco). 

Purpose/Research Question: In this paper, I explore the mechanics and implementation challenges of wage increases designed for early educators. 

• What are the core decision points in developing a wage increase?


• What implementation challenges do these decision points imply? 

Methods: I draw on a national scan of early education and guaranteed income (GI) wage interventions to develop a framework for building and implementing a pay increase program.  I also present a case study from a partnership with Contra Costa County to illustrate the tradeoffs and potential impacts, drawing parallels to interventions in the other two counties (Alameda and San Francisco). The case studies leverage a mix of administrative data, document review, and key informant interviews. 

Results/Findings: Nationally, the vast majority of pay boosts to early educators have been annual, modest stipends; typically, stipends are designed around retention and/or educational attainment. The new wage increase programs under development largely retain those purposes, but they are shifting towards monthly payment programs and richer overall benefits for educators. 

To design and launch these programs, the case studies show how the Bay Area counties approach eight implementation decision points:

• Inclusion criteria 


• Payment schema (cadence and benefit levels)


• Application and enrollment (for individuals and/or sites)


• Documentation and recordkeeping


• Implementation partnerships (including payment service)


• Evaluation and data collection 


• Service bundling


• Budget development and funding sources

The paper will explore the tradeoffs and decision points among the three county examples.

Conclusion/Implications: In the absence of broad-scale funding for ECE, states and counties are experimenting and facing distinct challenges in increasing wages. These case studies show it is feasible yet technically challenging to create a wage increase program. However, the case studies also offer lessons learned for other regions considering a program of their own.

Authors

• Anna Powell, University of California, Berkeley
  Presenting Author

• Hyeonjeong Lee, University of California, Berkeley
  Non-Presenting Co-Author