
Everybody knows about the talent gap the accounting profession is experiencing with accounting major graduates, which is caused by stagnant wages and a lack of education about career paths, according to Accounting Today.
Meanwhile, existing accountants are also exiting the profession entirely. Amid this pipeline crisis, firms are beginning to look inward to solve the problem.
The most recent ADP National Employment Report indicated that the service-providing sector added 101,000 jobs in September, 20,000 of which were for roles in professional and business services such as accounting and tax preparation. The month prior, the U.S. Bureau of Labor Statistics said 1,500 new postings described accounting-related job openings.
Despite the favorable data, those in the field think the hurdles to becoming a licensed CPA, including the test itself, are just not worth the price, Accounting Today said.
According to Erin Andrews, owner of Level Accounting & Advisory, the six-figure tuition, 150 credit hours and a median salary of $79,880 are just not going to capture the interest of most younger people when they can work from home, making money doing jobs they are actually interested in, while working with a flexible schedule.
She added that the abundance of social media personalities and private equity firms entering the accounting space as "supposed" experts are driving away consumer demand and devaluing licenses.
Some companies looking to address this problem are developing their own training regimens and partnering with outside trade groups to expand recruitment. For instance, New York-based Whitman Transition Advisors started its Talent Solutions Team this month to help clients address staffing issues via services that include full-time and fractional recruitment, outsourced advisory and technology tools.
Zachary Gordon, a CPA and chairperson of the New York State Society of CPAs' digital assets committee, stated that technology is not merely essential for tackling the immediate effects of the shortage, but is also shaping the evolution of the profession. "AI will help to complete mindless, repetitive tasks and allow talent to shine with higher-value aspects of an engagement. … Accounting becomes less about commodities like a tax return or financial statements and more about being a trusted advisor providing tangible value to clients," Gordon stated.
Aside from wages and upward mobility, Accounting Today said that the profession's long hours and general lack of flexibility are keeping younger professionals at bay.
Big firms like Ernst & Young recognize these shifts and are looking at plans to deal with some of the core issues. Its U.S. unit plans to appropriate about $1 billion in the next three years to boost early-career compensation and finance the development of artificial intelligence-powered audit and tax software, Accounting Today said.
Public perception, closer partnerships with colleges and universities and broader education about accounting career paths are all areas Accounting Today's Managing Partner (MP) Elite are working to make changes within their firms and throughout the profession. These suggestions are created for immediate deployment, or as a component of long-term strategies. MP Elite is a report that Accounting Today publishes that identifies and profiles the top leaders of public accounting firms.
"The accounting profession faces a significant challenge in how it's perceived, particularly by younger generations," Christopher Geier, chief executive of Sikich, said to Accounting Today. "To combat this, we need to launch a multitiered education and awareness campaign."
Recruiters are beginning to look at how long a candidate has been in accounting less, and concentrating more on what skills they have.
Accounting Today said that a declining number of college students are electing to major in accounting, making those who do a valuable asset to firms of any size. However, what can companies do to distinguish themselves from the rest?
"These successful firms will achieve this by creating a culture that fosters mutual support, offers meaningful career opportunities, promotes team cohesion and ensures both personal and professional fulfillment," Eric Abati, CEO of ATKG Advisors, stated during an interview with Accounting Today. "Simply put: Culture wins."
Abati represents leaders who focus on changing the corporate culture that is standard across accounting, while others focus on career mapping and wage disparities.
Competitive wages, ample preparation for certification exams and a rebranding campaign. These are just a few of the suggestions that experts with the National Pipeline Advisory Group gave for how firms can do their part in addressing the pipeline shortage. Salaries were on top given that the data from the group's report found that only one in nine business majors selected accounting as their major. The others were able to get a higher salary in a more competitive profession.