The early childhood education and care sector in Australia is undergoing a shift in philosophy. Changes in policy are driving the industry towards a combined early childhood education and care focus, away from one only on child care. This move has implications for the skilling of the child care workforce. This report examines workforce development strategies in the early childhood education and care sector and identifies the factors that affect the development of skills. The report explores how broad policy environments and local labour market challenges shape and influence employer choices about the development and use of labour. (Contains 2 figures and 10 footnotes.)