Early Childhood Education 2026: Key Issues

States are bracing for tough choices as federal funding for early childhood education dwindles, potentially impacting access to care for millions of families. Experts predict 2026 will be a particularly challenging year for the sector, with cuts to key programs looming after the 2026 midterm elections.

<p>“It’s pretty grim,” said Natalie Renew, executive director of Home Grown, a national initiative committed to improving the quality of and access to home-based child care, about the outlook for the sector.</p>

<p>“I don’t think anyone is particularly optimistic about child care” in the new year, added Daniel Hains, chief policy and professional advancement officer at the National Association for the Education of Young Children (NAEYC).</p>

<h2>State Budgets Tighten as Federal Aid Dries Up</h2>
<p><em>Experts warn that cuts to Medicaid and SNAP, coupled with the expiration of pandemic-era funding, will force states to make difficult decisions about early care and education investments.</em></p>

<div style="background:#eef7ff;padding:12px;border-left:4px solid #007acc;" aria-label="Key takeaways">
    <ul>
        <li>The One Big Beautiful Bill Act, signed into law in July 2025, includes cuts to Medicaid and SNAP, shifting costs to states.</li>
        <li>New Mexico’s move toward universal child care offers a potential model, but faces funding challenges.</li>
        <li>Increased immigration enforcement is disrupting the early childhood workforce, particularly in urban areas.</li>
        <li>Despite challenges, some states are continuing to invest in early care and education, and the issue is gaining traction in political campaigns.</li>
    </ul>
</div>

<p>The prospect of widespread funding cuts comes after a year of both progress and setbacks for early care and education in 2025. Several states made strides in supporting families and providers, while others faced challenges stemming from political battles and the end of pandemic relief funds.</p>

<h3>Wins for Early Learners in 2025</h3>
<p>Some states <a href="https://static1.squarespace.com/static/6407aa4bc56393442ff05b2f/t/6940304dab57ff604b01d45e/1765814350232/2025+State+Review.pdf">made progress</a> in policies shaping child care and early childhood education. In 2025, <a href="https://www.childfamilyresources.org/blog/historic-funding-victory-for-arizonas-children-and-families/">Arizona</a>, <a href="https://ctmirror.org/2025/06/02/ct-early-childhood-education-bill/">Connecticut</a> and <a href="https://zerotofive.org/wp-content/uploads/2025/06/HB-924-Trust-Fund-Explainer.pdf">Montana</a> were among those that made new investments in the field. New Mexico took its <a href="https://www.the74million.org/zero2eight/new-mexicos-investments-in-early-care-and-education-begin-to-show-progress/">gains</a> in recent years a step further by <a href="https://www.nmececd.org/universal/">announcing</a> free universal child care for all families, regardless of income, beginning last November.</p>

<h3>Head Start Under Pressure</h3>
<p>Despite these wins, Head Start faced significant political headwinds throughout 2025. The program was <a href="https://www.usatoday.com/story/news/education/2025/04/11/trump-proposal-eliminating-head-start/83045346007/">proposed for elimination</a>, saw many of its regional offices <a href="https://nhsa.org/resource/nhsa-expresses-deep-concern-over-administration-shuttering-regional-offices/">closed</a>, and nearly had access to services <a href="https://www.the74million.org/zero2eight/ongoing-federal-shutdown-threatens-head-start-access-for-over-65k-children/">lost</a> during the prolonged <a href="https://www.the74million.org/article/the-shutdown-is-over-but-thousands-of-kids-are-still-locked-out-of-head-start/">government shutdown</a>.</p>

<h3>States Scale Back Support</h3>
<p>As federal pandemic relief dollars dried up, some states began to <a href="https://homegrownchildcare.org/child-care-at-risk-how-federal-funding-cuts-and-government-shut-down-hurt-families-and-home-based-providers/">pull back on support</a> for families and programs. <a href="https://www.the74million.org/zero2eight/indiana-child-care-providers-struggle-to-stay-open-after-state-slashes-rates/">Indiana</a>, for example, slashed provider reimbursement rates, while other states instituted co-pays for families using subsidies and changed subsidy eligibility requirements, according to <a href="https://info.childcareaware.org/blog/no-time-to-wait-how-child-care-funding-uncertainty-and-the-reemergence-of-waitlists-are-shaping-families-futures">reports</a>.</p>

<h2>1. Child Care Spending: States Begin Tightening the Belt</h2>
<p>The One Big Beautiful Bill Act, <a href="https://www.the74million.org/article/big-tax-bill-passes-senate-with-less-beautiful-plan-for-national-school-choice/">signed into law</a> in July 2025, includes significant cuts to <a href="https://www.the74million.org/zero2eight/how-medicaid-cuts-could-impact-early-intervention-for-young-children/">Medicaid</a> and <a href="https://www.the74million.org/zero2eight/with-snap-cuts-this-federal-food-program-may-become-a-lifeline-for-families/">SNAP</a>, effectively shifting costs to states.</p>

<p>“It’s less painful to do it slowly than all at once,” explained Melissa Boteach, chief policy officer at ZERO TO THREE. States, unlike the federal government, must balance their budgets and will likely explore new taxes or program cuts to address the shortfall.</p>

<p>“Uncertainty is the word,” said Aaron Loewenberg, senior policy analyst at New America. “There’s a lot of anxiety and uncertainty at this point about what the next year or two could look like.”</p>

<p>Hains of NAEYC predicts a growing divide between states with the resources to invest in early care and education and those without. “We’re going to be looking at two very different countries: States that have revenue to invest in child care and early learning — [like] Vermont, New Mexico, Connecticut, Montana — while other states are going to be in more constrained and challenging situations.”</p>

<h2>2. Expanding Access: Can Promises of Universal Child Care Be Fulfilled?</h2>
<p>New Mexico’s <a href="https://www.the74million.org/zero2eight/new-mexico-will-become-the-first-state-to-offer-universal-child-care/">free, universal child care</a> initiative, launched last November, has <a href="https://www.the74million.org/zero2eight/new-mexico-charts-a-path-for-universal-child-care/">inspired</a> advocates. The initiative’s early days will be closely watched by experts.</p>

<p>Loewenberg of New America will be looking at how New Mexico navigates <a href="https://www.theatlantic.com/family/2025/10/new-mexico-free-universal-child-care-gamble/684722/">challenges</a> in implementation, family satisfaction, and the potential for replication in other states.</p>

<p>All eyes are also on New York City, where Mayor Zohran Mamdani has <a href="https://www.vox.com/politics/466205/zohran-mamdani-child-care-daycare-voters-politics-nyc-kids-parents">pledged</a> to pursue universal child care. Securing state government <a href="https://19thnews.org/2025/10/mamdani-hochul-universal-child-care-new-york/">cooperation</a> will be critical.</p>

<p>Hains believes the conversation is shifting from *whether* child care is a public responsibility to *how* it should be funded.</p>

<h2>3. Workforce Instability: Immigration Enforcement Creates Chilling Effect</h2>
<p>Increased immigration enforcement by the Trump administration in 2025 has had a negative impact on the early childhood education workforce. An estimated <a href="https://www.sciencedirect.com/science/article/pii/S0047272724000379">one in five</a> early childhood educators are immigrants, rising to nearly half in cities like New York, Los Angeles, and Chicago.</p>

<p>A New America <a href="https://www.newamerica.org/better-life-lab/reports/impact-of-increased-ice-activity/">report</a> released in December found a correlation between increased ICE activity and a decrease in foreign-born child care workers: between February and July 2025, there were 39,000 fewer foreign-born child care workers than in 2024.</p>

<p>“Immigration enforcement, to me, right now, is the number one disruptor both to parent behavior and provider behavior,” said Renew of Home Grown. The increased visibility of ICE activity has created a culture of fear, even among educators and parents with legal status. With <a href="https://hechingerreport.org/child-care-centers-were-off-limits-to-immigration-authorities-how-thats-changed/">early learning settings</a> now subject to ICE enforcement, concerns are growing.</p>

<h2>4. Bright Spots: Solutions Emerge Amid Challenges</h2>
<p>Despite the challenges, there are reasons for optimism. Head Start <a href="https://www.the74million.org/zero2eight/head-start-may-have-gotten-a-reprieve-but-its-not-out-of-the-woods/">remains</a> a funded federal program. Several states, including New Mexico, Vermont, New York, Texas, and Washington, are continuing to invest in early care and education.</p>

<p>Early care and education is also proving to be a winning issue in political campaigns. Candidates who campaigned on supporting families and children won elections in New York, New Jersey, and Virginia.</p>

<p>“You’re seeing in the elections that candidates that ran on child care, ran on helping families and children, won,” Boteach said. “These are winning political issues, which means both parties should be vying to talk about these issues and govern on these issues.”</p>