By Michael Wood, Vice President, Education & Workforce
Average reading time: 2.5 minutes
In July, Congress passed a budget reconciliation bill that codified many significant changes to federal spending. Among the hundreds of provisions was a longstanding priority for postsecondary education access championed by the DRC: Workforce Pell.
Under new guidelines, students will now be able to draw down federal Pell Grants for short-term workforce training programs aligned with in-demand, high-wage occupations. Here’s what you need to know about the new program.
Pell Grants are the most common form of federal financial aid for higher education
Established by Congress in 1972, Pell Grants have helped millions of students access higher education throughout the country. Students may receive a Pell Grant if they meet the income eligibility requirements and are an undergraduate pursuing their first postsecondary degree. Award amounts vary per student based on individual need and their postsecondary enrollment status, up to a maximum of $7,395 for the 2025-26 school year.
Annually, roughly a third of the country’s nearly 25 million undergraduate students receive a Pell Grant based on their financial need. In Texas, 34.4% of the state’s undergraduate students receive a Pell Grant, with an average award amount of nearly $5,000.
These grants are vital in helping students attain a postsecondary education. In fact, the average Pell Grant award in Texas is often more than enough to cover the entire cost of attendance at an in-state community college.
However, students enrolled in short-term workforce training programs have historically not been eligible for Pell Grants. While these programs are often cheaper than a traditional two- or four-year degree, the cost can still be prohibitive for students.
Creation of Workforce Pell is a hard-fought win for postsecondary access
Workforce Pell has long been a priority for higher education access advocates, including the DRC.
Across the state, 54% of jobs require training beyond a high school equivalency but less than a four-year degree, yet just 45% of Texans meet this threshold. This mismatch leaves many good-paying jobs unfilled, suppressing economic growth broadly and for individual families. Workforce training programs are well positioned to fill the gap.
Under the new guidelines, students enrolled in workforce training programs between 8 and 15 weeks, with at least 150 clock hours, will now be able to draw down Pell Grants provided they are enrolled in an eligible program and meet other income-based criteria.
To be Pell Grant eligible, workforce training programs must meet additional approval requirements, including established workforce demand, minimum completion and job placement rates, and earnings thresholds for graduates.
Workforce Pell is slated to take effect by July 1, 2026, in time for students to receive Pell Grants for the 2026-27 academic year. To keep up with increased demand and a pending budget shortfall, Congress appropriated an additional $10.5 billion for Pell Grants for fiscal year 2026 as part of the reconciliation package. Once live, Workforce Pell will help students access a range of high-demand, high-wage training pathways in industries like healthcare, information technology, logistics and manufacturing, and construction.
What this means for business
Many Texas community colleges were already doubling down on skills-training, thanks in large part to House Bill 8 from the 88th Regular Texas Legislative Session that overhauled the state funding formula for two-year colleges to focus on student outcomes.
Now, with federal aid on the table, employers can expect to see community colleges and other institutions of higher education investing even more in short-term workforce training programs aligned with critical occupations, from cybersecurity and nursing to HVAC and plumbing.
Does your company have any open roles that Workforce Pell may help fill? Send me a note at mwood@dallaschamber.org.