Early childhood centres are worried they will run out of teachers as Omicron spreads.
Groups representing early learning service owners and managers said there was already a teacher shortage and many services would not be able to find enough relievers to stay open if the virus infected their staff.
Early Childhood Council chief executive Simon Laube said the virus was hitting more and more centres.
"We're getting calls every day from centre managers who are responding to cases in their centres, staff who are having to isolate because someone in their household has Covid. It's just going up, and up, and up," Laube said.
"People are quite in that panicky phase because for a lot of centre managers this is their first case."
The sector had been hoping to use rapid antigen tests to screen children and teachers but there were not enough for that to happen, he said.
The shift to phase three of the red traffic light setting, with its less stringent rules around close contacts, probably would not help much, he said.
"That will just bring more cases back into the centre sooner and that doesn't really help them keep running, because you're not going to run your centre with sick teachers," he said.
Te Rito Maioha Early Childhood New Zealand chief executive Kathy Wolfe said teachers needed better access to rapid antigen tests to ensure healthy teachers were not isolating for nothing.
"They'll be sitting at home isolating for 10 days and it's not a profession that you can do online. Some of the schools are able to do that, but in early childhood it's much more difficult so you've got teachers sitting at home who potentially are not symptomatic and could well and truly be at the service in front of children," Wolfe said.
Many early learning services had very few staff so it would not take many absences to force closures, she said.
"There are services that because, especially the smaller ones where they might have only one or two teachers, if one is even a close contact or positive, they're out for 10 days and if they don't have the right ratios, they have to close their doors," she said.
The owner of three centres on Auckland's North Shore, Michelle Bosch, said she had to close one of the sites earlier this week after a teacher tested positive for Covid-19.
The move to phase three of the red light setting meant the centre could reopen again, but she worried further closures might be unavoidable.
"The key aspect for us is going to be staffing because I've now got two of my teachers isolating, one through catching it and the other through her daughter at another school catching it so she's now a household contact, so there is going to be some massive implications from a staffing point of view," she said.
Bosch said she had already warned families that there might be disruption.
"One of the potential options is if I haven't got enough staff, I will have to reduce our operating hours, because you just simply can't cover staffing for a 10-and-a-half-hour day and the other thing I've alerted them to is when we're really short, it may be that I send an email and say 'we're desperately short of staff can anyone keep their child at home tomorrow'," she said.
Bosch said centres government funding rates depended on the number of qualified teachers working each day.
If they were forced to use unqualified staff, their funding rate could fall and that could cost centres tens of thousands of dollars, she said.