The Department for Education has unveiled plans to pilot incentive payments for new early years workers across 20 local authorities, to encourage more people into the profession ahead of the upcoming expansion of funded childcare hours.
The £1,000 tax-free incentive payment is available for up to 3,000 new or returning staff, with the pilot set to run between April to December 2024. Local authorities involved include Birmingham, Doncaster, Wirral and Islington. Pilot sites have been selected based on areas of greatest need for staff.
Under government plans, all two-year-olds from working families – each parent must work at least 16 hours a week and earn less than £100,000 a year – will be eligible to receive 15 hours of funded childcare a week from April. More than 100,000 children have been registered already. The 15 hours of support will then be extended to working parents of children aged between nine months and three years from September. This is planned to increase to 30 hours for eligible working families of children from nine months old in September 2025.
Rising demand for childcare workers linked to the expanded offer has led to a 146 per cent increase in job postings for early education and childcare practitioners, according to the Recruitment & Employment Confederation and Lightcast Labour Market Tracker.
In light of this, the incentive has been welcomed by some sector organisations. Purnima Tanuku, chief executive of the National Day Nurseries Association, says: “We have been calling for this national recruitment campaign to support the early years sector for years, so we very much welcome this initiative. The sector needs thousands more staff so we hope that the tax-free incentive will form part of a comprehensive workforce plan.”
However, June O’Sullivan, chief executive of London Early Years Foundation, is less convinced “golden hellos” will work. “The NHS has been doing this for years and we have the London weighting but there is no real evidence to suggest that this has impacted positively on recruitment or retention,” she adds.
While incentive payments may help attract new staff, there is scepticism it will tackle the retention crisis affecting the sector – the turnover rate for all group-based providers was 19 per cent in 2022/23 compared with eight per cent for school-based settings.
Sarah Ronan, director of the Early Education and Childcare Coalition, says: “Low pay, limited professional development and an undervaluing of the profession means providers are now struggling to recruit at a time when the government has promised to increase places. While the DfE’s recruitment campaign is to be welcomed, it is not a solution to what is ultimately a retention crisis.”
The mixed reaction (see expert views below) reflects scepticism across the sector that, while welcome, the incentive payments alone will not solve the early years workforce crisis.
Incentive payment a welcome step
Ellen Broomé, managing director, Coram Family and Childcare
Our recent research found that 88 per cent of councils think the childcare workforce is a barrier to successful delivery of the extra childcare that is being rolled out from April. The government’s announcement of a cash incentive and a campaign to raise the profile of childcare workers is a welcome step in addressing these issues, recognising the valuable and rewarding work of early years professionals.
But on its own it will not deliver the step change that we need. This should be the first step towards a full early years workforce strategy that addresses the significant challenges around retention and recruitment with better pay, training and career progression, as well as a focus on recruiting the right people with the right skills.
The extra childcare support has the potential to be a game changer for parents – particularly mothers – who find themselves locked out of work because of high childcare costs. We need to ensure this policy delivers on its promise and that no family or child misses out on the high quality early years education they are entitled to.
Bonus should target inequality
Tammy Campbell, director for early years, the Education Policy Institute
Whether the government’s recruitment bonus is sufficient to attract new staff to the sector remains to be seen and should be monitored. Whether the incentive and other investments are sufficient to tackle longstanding issues within early years provision – aside from recruitment – should also be monitored.
Key issues include staff retention. While the bonus is targeted at initial entrants to careers in the early years, it does not address high turnover and loss of qualified and experienced staff. Investments should also better target and address inequalities in access to quality provision. They should reward good early years professionals for working with more disadvantaged communities and children.
Strategic reconsideration of the overall structure of the early years market, where investment of public spending ends up, and who it serves, is also needed. Considering incentives and disincentives for private sector nurseries – who increasingly dominate the market – should form part of this, alongside exploring alternative models of provision.
