By Michael Cohn
Accounting firms are facing heavy competition to attract talent as the profession faces the kinds of hiring challenges confronting other industries in the current state of low levels of unemployment. While Big Four firms can afford to raise starting salaries and add nice perks and benefits, many smaller firms are finding it tough to compete for professionals with the requisite skills. This is putting more of a burden on the remaining staff and stressing firm managers as they seek realistic staffing solutions.
Firms used to be able to count on a steady stream of young people entering the accounting profession, but that’s no longer the case. Fewer young people are taking the CPA Exam, making it difficult to bring in younger talent to replace the wave of retiring baby boomers. The number of CPA Exam candidates entering the CPA pipeline declined in 2020 due to the pandemic, and those COVID concerns were still a problem last year. CPA Exam candidates decreased less than 0.5% between 2018 and 2019, but there was a 17% decrease between 2019 and 2020 (though there was a 6% increase between 2020 and 2021). The AICPA’s most recent trends report found total hiring of new accounting graduates in 2020 had decreased by 10%. Some firms are moving toward hiring nonaccounting graduates: the number coming into accounting and finance functions increased by 10 percentage points since the previous report.
Smaller and midsize firms are finding they need to increase salary offers, signing bonuses, and benefits to compete against larger, deep-pocketed firms and other industries looking to hire financial and technological talent. Last December, for example, Grant Thornton began offering employees extra enticements, such as enhanced parental leave, access to childcare, eldercare, pet care, meal planning, housekeeping, and subsidized meal-delivery services.
The added perks can put a strain on profits and make it harder for smaller firms looking to compete for talent and stop their employees from jumping ship. At the same time, the current employees are facing heavier workloads due to smaller staff sizes, especially during tax season or when financial filings come due. With many team members preferring to work remotely or in a hybrid arrangement, that can put extra stress on staffers who need to come to the office every day to meet with each other and clients, or just to keep the office running.
The PICPA will hold its brand new Accounting Workforce Conference on Sept. 23. We will be discussing many of these issues, including a session on workload challenges when hiring. As CPA firms try to adjust to the increasingly competitive war for talent that pits them not only against each other, but against employers in other sectors of the economy who also need skilled financial and technical professionals, they may need to adjust their benefits and starting salaries accordingly. At the same time, current employees need to be carefully retained and not overloaded with the extra work. Technology can help with efficiencies, especially in automating routine processes. However, firms still require human beings to do much of the work, and employers are realizing how precious of a resource they are.
Michael Cohn is the online editor-in-chief of Accounting Today. He can be reached at email@example.com.
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