The Money Nobody's Using

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You just spent $5,475 to hire a tech.

That's the average cost to recruit and fill a non-executive role right now. Job boards, staffing fees, your ops manager's Tuesday afternoons, all of it.

Meanwhile the average company spends about $1,283 per employee per year training the people already on payroll. Read that again. You'll pay four times more to find someone new than you'll spend upskilling someone who already knows your shop, your customers, and your equipment.

Here's what makes me want to shake people by the shoulders. There's a federal program that will reimburse you 50 to 90 percent of what it costs to train the techs you already have. Some states cap it around $100K to $200K per employer, per cycle. You pick the training. You pick the provider. It's called Incumbent Worker Training, and most trade employers have never heard of it.

Not because it's hidden. Because nobody at the local workforce board picked up the phone and said "hey, use this free money."

If you're bleeding techs to the shop down the road because they never got a real growth path, you didn't lose a talent war. You skipped a form.

Who's actually using this stuff

I'll rank the trades by who uses On the Job Training funding, worst to best, based on what I see in the field.

Bottom of the list: HVAC, plumbing, most residential electrical. Owners in these trades run lean, wear ten hats, and treat "government funding" like a trap with paperwork attached. So they eat 100 percent of the cost to bring a green tech up to billable speed, every single time.

Middle of the pack: collision repair, welding, diesel. Some awareness. A few shops working with a local workforce board. Most still assume OJT is only for "disadvantaged" hires, not the 24 year old who just needs six months of runway to get fast.

Top of the list: CDL, Trades, healthcare, and logistics. These industries figured it out years ago. Reimbursed wages while a new driver ramps, tied to a documented training plan. It's not that these companies are smarter than everyone else. It's that the funding stream is easier to find and the math is obvious the moment a seat sits empty and a truck doesn't move.

The pattern isn't complicated. Whoever has the tightest labor crunch and the clearest wage math finds the funding first. Everyone else assumes it's not for them.

It's for you. OJT reimburses a percentage of wages while someone is genuinely still learning the job. If you're already paying a green hire full wage while they figure out your systems, you're already funding this program yourself. You're just not getting paid back for it.

The pipeline sitting in plain sight

Every trade school owner I talk to says the same thing. "I can't fill my seats."

Then I ask if they've called their state's Vocational Rehabilitation office, and most of them go quiet.

VR exists to fund training and support services for people with a documented barrier to employment so they can get into a career. That population includes veterans with service-connected conditions, people recovering from injury, people with a disability that a trade skill can work around better than a desk job ever could.

Here's the part that stings. VR counselors are actively looking for training providers to refer people to. They're not gatekeeping. They're hunting for good programs because they have caseloads to place and outcomes to hit.

Schools that built a real relationship with their state VR office are running full cohorts on funding they didn't have to fundraise, market, or discount for. Schools that ignore it are running paid ad campaigns to find the same students VR already has a list of, ready to place.

If your admissions team has never sat down with a VR counselor, you're not short on students. You're short on the one phone call that fixes it.

Where the money actually sits

Texas, Georgia, California, Florida, and Illinois get the biggest slice of the roughly $2.9 billion in WIOA formula funding every year. That's not the controversial part. Big states, big populations, big allocation. Fine.

Here's the part that should make every trade employer angry. State workforce agencies are sitting on unspent WIOA balances right now, in some cases tens of millions of dollars, according to DOL's own data. Not because employers don't need the training. Because local workforce boards aren't pushing it out the door.

I've had local board staff tell a client "we don't have funding for that" in the same program year the state was carrying a balance nobody touched. That's not a funding problem. That's a local board deciding not to prioritize you, and an employer accepting "no" instead of picking up the phone to the state office.

If your local board tells you there's no money, ask them what the state's unexpended balance looks like. Then ask why your request isn't a priority. You're allowed to escalate. Almost nobody does.

The states with the biggest allocations aren't the ones training the most people per dollar. They're just the ones with the most money sitting around waiting for someone to ask for it correctly.

Two shops, same city, two different futures

Picture two Forklift companies in the same city, same labor market, same starting point three years ago.

Company A hires green, pays full wage from day one, eats every dollar of ramp time, and complains constantly about tech turnover and rising cost per hire. They've never filed an OJT agreement. They think WIOA is "some government thing for unemployed people," not something built for their exact hiring pattern.

Company B partners with the local trade school's admissions team, takes OJT-eligible hires straight out of the program, gets a chunk of wages reimbursed during ramp-up, and runs IWT for the senior techs learning heat pump and mini-split work as the market shifts. Their cost per hire is a fraction of Company A's. Their techs stay, because there's an actual training ladder instead of "figure it out."

Same trade. Same city. Same funding sitting there for both of them. One company built a pipeline. The other built an excuse.

The whole barrier is one phone call

If you're Company A reading this, the fix isn't complicated. It's a conversation with your local workforce board and the trade school two miles from your shop. That's it.

Stop competing for techs on Indeed. Start competing for the funding that's already sitting there, waiting for someone to use it right.

Until next time, control what YOU can control, take action on something, and don’t forget to smile. Like what you read? Here’s how you can help:  Share this newsletter with friends who could use a boost. Sharing is caring!

Connect with me on X (formerly Twitter) – let's chat and support each other. Find me at @Trade Schools Secrets-WIOA Whisperer