Leveraging WIOA Flexibility: North Carolina’s Big Bet on Youth Apprenticeship

Earlier this month, Governor Josh Stein announced that he will dedicate discretionary funds under the Workforce Innovation and Opportunity Act (WIOA) to scale registered youth pre-apprenticeships in high-demand sectors. Specifically, the funding will go to support NC Career Launch, which is North Carolina’s Youth Apprenticeship System led by the Office of the Governor and the NC Business Committee for Education. NC Career Launch works in close partnership with workforce boards, community colleges, ApprenticeshipNC, and the North Carolina Department of Public Instruction (NCDPI) to increase credential attainment through registered pre-apprenticeships. Stein’s decision illustrates how governors can use WIOA to execute their vision for workforce development—with youth apprenticeship as a central strategy.

Discretionary dollars, also known as reserve funds, are 15 percent of a state’s overall WIOA allocation that governors can direct toward their highest workforce development priorities. Similar flexibilities exist in other federal funding streams, such as The Strengthening Career and Technical Education for the 21st Century Act (Perkins V). The funds are designed to provide flexibility for states to incubate new ideas and implement promising initiatives.

How States Typically Use WIOA Reserve Funds

Despite the intent, evidence shows they’re not always being used this way. In a 2025 report, governors’ advisors across 34 states were interviewed to learn more about how they were leveraging WIOA to advance their workforce development priorities. When asked specifically about how they were using reserve funds, two-thirds used at least part of the funds to backfill administrative or operational costs. Fifty-four percent did say they used reserve funds to seed innovation. But even so, most of them spread the funds across multiple initiatives and programs, with apprenticeship often competing with other priorities.

Maryland offers one example of how states spread reserve dollars across priorities. In 2018, the Maryland Department of Labor announced strategic investments in career pathways using WIOA reserve funds. Local workforce boards could apply for up to $250,000 to develop innovative projects, with registered apprenticeship or pre-apprenticeship being one of several eligible concepts. In 2022, the state identified 10 separate governors reserve-funded activities to fund. Though three of the projects targeted youth apprenticeship, the bulk of the funds went to other high-priority efforts. Nonetheless, Maryland has sustained strong support for apprenticeship through other funding streams, including the most recent Maryland Apprenticeship Incentive Program that serves as an exemplar for pay-for-performance apprenticeship models.

Michigan’s Governor Whitmer has taken a similar diversified approach to allocating reserve funds. In performance year 2023, the Michigan Department of Labor and Economic Opportunity reported using WIOA reserve funds to support more than 10 initiatives aligned with the statewide workforce plan. These included developing a registered apprenticeship dashboard, expanding registered youth apprentices, and providing supportive services to unemployed and underemployed workers in new registered apprenticeships, among other high-priorities.

Governor Greg Abbott in Texas leverages Wagner-Peyser 7(b) funds—which is a slightly different pot of reserve dollars under the WIOA umbrella—to administer the annual Texas Talent Connection grant program, facilitated by the Texas Workforce Investment Council. The program funds exemplary workforce training projects, innovative approaches to the delivery of workforce services, and workforce programs that support vulnerable populations. In 2025, Governor Abbott awarded more than $7.3 million to 22 communities. While several grantees emphasized youth apprenticeship and apprenticeship, the funds were distributed across a range of innovative concepts.

What Makes North Carolina’s Approach Distinct

Governor Stein appears to be “all in” on one initiative: high school youth apprenticeship. Although concentrating reserve funds in one area may seem risky, state leaders in North Carolina recognize the move as a strategic investment aligned with a broader workforce development agenda.

In 2025, Governor Stein established the Governor's Council on Workforce and Apprenticeships, which approved 11 statewide workforce development goals and designated responsible entities for each. These goals include increasing the number of young people attaining credentials of value, doubling the state’s number of registered apprentices, doubling the number of high school students participating in work-based learning, and increasing employer engagement. There is much momentum building across the state to make progress toward these goals. Just before the governor’s announcement about WIOA reserve funds, NCDPI announced that credential attainment among high school career and technical education (CTE) students has reached an all-time high and the state now ranks second in the nation for CTE participation. The governor’s timely investment of WIOA reserve funds underscores that youth apprenticeship is yet another strategy to amplify the momentum already in motion across the state.

Through intentional alignment of reserve funds with a clearly defined statewide strategy, North Carolina is demonstrating how governors can use WIOA not just to administer programs, but to drive their workforce agenda. In doing so, the state offers a compelling model for others seeking to leverage federal funding flexibility to expand youth apprenticeships and strengthen career pathways.