AICPA CEO of Public Accounting and Going Concern favorite Sue Coffey swung by the Accounting Today podcast recently to talk about what else, the pipeline problem. The interesting bit pops up right away in the episode. Here she is talking about how the AICPA is digging through the data to identify reasons for the accountant shortage beyond the ones we already know like declining birth rates (down 22.9 percent since 2007) and fewer people going to university in general. Those two issues are affecting all college-educated professions, not just accounting. No, they’ve got to figure out why accounting. Rather, why not accounting.
Here’s what the AICPA has found on their quest to pinpoint reasons for the pipeline problem, in Sue’s words:
[T]here’s also a lot of data that we’ve been kind of parsing through to determine other root causes of the talent challenges we’re having. And we’re finding that there are leakage points in a couple of key areas that are kind of driving our focus as part of this initiative. One is in the college to graduation group and about 208,000 on any given year declare an accounting major, but then by the time they graduate, only 50,000 are graduating in accounting. So there’s something going on in that declaration of a major to graduation and university.
AICPA’s Sue Coffey speaking on the Accounting Today podcast episode “A pipeline progress report“
In other words, something’s happening junior/senior year to pivot a lot of willing victims eager students away from accounting and into something else. Something other than Intermediate alone, probably.
Brushing past that, they somehow figured out that people who no more than five years in public accounting are poisoning the well and tales of their negative experiences are echoing down as far as high schools. For every pair of cool accounting professors giving talks at the local high school, you’ve got however many hundreds of comments online contradicting everything the profession’s cheerleaders are saying out on their roadshows.
Another area we’re finding relates to retention and how retention in firms is impacting the beginning of the funnel and the desire for people to come into our profession. And so that one to five year group of professionals that are within a firm and tend to leave within that period and may not have a good experience are impacting what, for example, high school and college students think about our profession and that’s creating pipeline challenges.
This was CSU Monterey Bay professor Shaowen “Sharon” Hua speaking to students at North Salinas High School about why accounting is a pretty good career earlier this year:
“Accounting jobs pay well,” she told them. “Accounting jobs are fun.”
“I have a [former] student who works for Driscoll,” Hua said of the Watsonville-based berry grower. “She travels to England, Singapore and Japan because Driscoll has businesses all over the world.”
“You might work with clients from Pebble Beach, the NBA and Hollywood,” she said. “They have so much money, they don’t know where to put it and you get to service them.”
And this is the other side of the coin, one of the first posts one is greeted by when visiting r/accounting today.
When did you realize that it was time to get out of public accounting?
byu/stanerd inAccounting
The other thing I feel compelled to point out from Sue’s appearance is this. SALARY is a naughty word.
We’ve been talking about the S issue for many, many months now, right? Starting salaries are not where they need to be in our profession, and those young adults and young professionals see more opportunity elsewhere for higher pay.
The S word. I mean, it is obscene how little they pay early-career public accountants, maybe we should have been censoring the S word all along.
lol accounting isn’t fun and does not pay well. Increase salaries and pay overtime.
Funny how the numbers have gone down as the public information/disclosures on what it actually is to BE an accountant have gone up. I’m glad young/mid-level accountants/aspiring accountants have found other paths and have discovered the unspoken truths it took so many of us so many years to find out.
You misspelled telling the truth. The industry is deterring people. The zero work life balance 6 months out of the year, worse at some firms, for little pay is the problem. The industry as a whole needs a revamp.
if the cost of a 150 credit bachelors degree is about 80K, based on a few calculators that job needs to pay about 97K to pay for it. Its not complicated to see what’s happening here.
Its not a bad career overall, but its not a great one either. No its not fun most of the time, there are quite often long hours with 85% of the tasks being monotonous, with the pay being average at best considering all that is asked. Therefore, burnout is high. Yet there are a few positives here and there.
Truth is it takes a certain personality type to really enjoy the work, especially after the first few years when so much becomes routine. That’s what I’ve told potential candidates from my alma mater who call and ask questions. I’ve known people who do enjoy it, and I’ve known people who wish they had gone into something else. Its about 50/50.
Considering you have to add the extra year of school, even if its in the new AICPA work while school program, often opportunities are just as good or better starting out in industry without doing the extra year. If not, somebody could always start in public without the 150 hours and see if other opportunities arise or if after couple years they really want to be CPAs, and pursue the extra schooling. Its not like the firms don’t need the staff.