Is the talent shortage a threat to accounting’s success?

TLDR:

• The accounting profession in the US is facing a talent shortage, with about 75% of Certified Public Accountants (CPAs) expected to reach retirement eligibility by 2020.
• In the UK, the profession has not grown in popularity in recent years, and the number of young people entering the profession is declining.
• To address the talent shortage in the US, the American Institute of Certified Public Accountants (AICPA) has formed the National Pipeline Advisory Group to develop strategies.
• One strategy to attract new talent is to rebrand the profession as a technology profession, emphasizing the role technology plays in modern accounting practices.
• Firms need to highlight the unique and compelling aspects of a career in accounting, such as the opportunity for diverse industry experience and transferable skills.
• Firms should also set realistic salary expectations to bridge the gap between the salary expectations of recent graduates and the reality of entry-level positions.

The accounting profession in the US is facing a significant talent shortage, with an estimated 75% of Certified Public Accountants (CPAs) expected to reach retirement eligibility by 2020, according to the American Institute of Certified Public Accountants (AICPA). This shortage is compounded by a decrease in new students majoring in accounting, leading to a competition for talent, particularly among larger international firms.

The UK has not yet experienced the same shortage, but the profession has not grown in popularity in recent years and the number of younger people entering the profession is starting to decline. This shortage is a result of factors such as voluntary resignations, the retirement of Baby Boomer accountants, and a lack of interest among young people due to misconceptions about the profession.

To address the talent shortage in the US, the AICPA has formed the National Pipeline Advisory Group. This collective of accounting stakeholders will develop strategies to address the profession’s talent shortage, informed by technology, surveys, and in-person forums. This initiative demonstrates a proactive approach to addressing the talent crisis and could serve as a model for other firms.

One strategy to attract new talent to the accounting profession is to rebrand it. Traditionally, accounting has been seen as a mundane and monotonous profession, but today’s accountants are far from that stereotype. They are forward-thinking individuals who leverage technology and possess strong analytical skills. Firms need to emphasize these selling points and showcase the exciting and diverse opportunities that the profession offers.

Janet Malzone, the national managing partner of audit services at Grant Thornton, suggests that the profession should be rebranded as a technology profession to reflect the significant role technology plays in modern accounting practices. The AICPA & CIMA are preparing accounting professionals with learning programs and resources to expand their competencies for the changing profession.

In order to attract new talent, firms must highlight the unique and compelling aspects of a career in accounting. Accountants possess a wide range of transferable skills that make them valuable assets to any organization. Beyond technical accounting tasks, accountants have the ability to analyze data, identify trends, and provide strategic insights that drive business decisions. Firms should emphasize these transferable skills to attract individuals seeking dynamic and versatile career opportunities.

Compensation is another crucial factor in attracting and retaining talent. Firms need to set realistic salary expectations and educate students about the career progression in accounting. While starting salaries may not be exceptionally high, the profession offers a stair-stepped career path with opportunities for growth and increased income over time. By setting realistic salary expectations early on, firms can manage candidates’ perceptions and attract individuals who are genuinely interested in the profession.

Overall, the accounting profession is facing a talent shortage, particularly in the US. To address this shortage, firms need to rebrand the profession, emphasize the unique and compelling aspects of a career in accounting, highlight transferable skills, and set realistic salary expectations. By taking these steps, firms can attract new talent and ensure the profession remains relevant, resilient, and trusted.