A popular type of word work in First / Second grade classrooms is Making Words. It is part of a Balanced Literacy approach to phonic instruction.
In general, you have a longer mystery word with letters cut out in alphabetical order - vowels first. Students begin making two letter words, then three letter words etc. Students then look for patterns in the words, words with e or a, or rhyming. The challange at the end is seeing if you can figure out what the longer mystery word.
The activity occurs whole group, small group, or individually. When done in small group or individually students would cut out letters needed to begin making words. It was not uncomon for a cut out letter to be lost or cut out beyond recognition.
One nice feature of Google Draw is it allows for hands on manipulation of individual letters without the tediousness of cutting and pasteing. A teacher could create a copy of an activity that each students saves to their Google Account or Google Classroom.
I have created a Making Words folder with activities for cloud, magnets, and camera, and well as a Bug to Hen activity.