As far back as I can remember, we have been discussing talent shortages within the accounting industry. My former esteemed colleague Colin (RIP bro) once referred to it as Groundhog Day, in that it felt like every other morning we woke up and wrote a story about it. I even put a considerable amount of effort into addressing the current state of accounting talent shortages last year, which I guess makes it not that current.
Well, if talent shortages are your bag, you’re in luck! It’s in the news again.
CFO Magazine tackles your favorite topic thusly:
For the past several years, CFOs have regularly rankled at their difficulties recruiting and retaining skilled people in finance, selecting the subject as their primary or secondary concern. As the most recent second-quarter survey from Deloitte states: “When it comes to internal risks, talent concerns again top CFOs’ list. With CFOs cited growing struggles to execute on initiatives supporting their growth strategies, their focus on talent acquisition, quality, and retention further intensified.”
In other words, talent recruitment and retention is an even bigger problem than it was in years past. This is not completely surprising. The labor market for skilled accountants is tightening, with the Bureau of Labor Statistics predicting that the demand for accountants will rise 10% through 2026, faster than the average growth rate for all occupations. With the supply of quality accountants shrinking, CFOs aren’t going to allay their concerns about talent any time soon.
According to the freshest available data from the AICPA, we’re still seeing record numbers of accounting undergrads, so the pipeline is plenty full, just not, you know, full enough. It’s kinda like when you’re at a nice hotel with a great big showerhead that merely trickles rather than rains.
Here’s the thing. There’s the large yet malnourished elephant in the room we can’t help but address: PAY. If everyone is so desperate for top talent, then why don’t they show it in the form of competitive salary and benefits? I don’t mean competitive relative to similar positions at other firms; I mean TRULY competitive. You want to recruit top accounting talent? PAY THEM. At the end of the day, that’s all that matters. Anyone who tells you otherwise is either naive or blessed with parents who pay their rent.
Many years ago, another publication was trying to poach me from GC. The money was significantly better for a much smaller workload. You know what I did? Like an idiot, I turned it down because I did not want to leave Going Concern in the lurch just to better my own situation. A year later, the company that owned GC at the time laid me off. What I learned from that fun little experience is that yeah, things like culture and enjoying your work are important and all, but I was an absolute moron to turn down more money just because I felt some emotional attachment to my job; clearly my job did not feel the same about me. Thankfully, accountants are generally smarter than professional writers, especially when it comes to money.
As my esteemed former colleague handwrung over last year, the profession is filled with complicated issues that don’t necessarily have easy solutions. Diversity and inclusion, workloads, work quality, reluctance to embrace technology, you name it. All that stuff is tough to figure out; it’s going to take some time if it even gets solved at all. But the talent thing could be fixed tomorrow if firms just dug deep in the ole pockets and paid people more. Simple, right? You’re welcome, profession.
I’m all for higher pay. I like receiving more money just as much as, if not more than, the next guy.
We know how the firms set pay, they all submit their pay data to third parties that go back and crunch the numbers to spit out reports for the firms that tell them “here is the pay range for a public accounting associate, etc”. The firms then make sure their ranges lines up with that. We then all act surprised that the big4 pay the same and universally agree that it sucks. Well, surprise!, they’re all working off the same data set and most of us continue to show up for work for those amounts day in and day out.
As far as addressing the talent issue, if one firm decides to take their pay benchmarking report this year and… I dont know… bump all their ranges up 20%, would that actually address the issue? I’d say its doubtful for two reasons. First, it might draw some candidates from other firms dissatisfied with their comp, but for good performers the firm the candidate is leaving would certainly counter (within reason). While this might lead to the firm with increased comp securing some high performers, in response, the other firms would likely increase their ranges eliminating the benefit. Second, the money for increased compensation has to come from somewhere, so either fewer resources are hired (leading to longer hours) or lower margin work has to be forgone (meaning fewer jobs overall due to less work). I’m sure there are plenty of other scenarios, but across the board I dont see a meaningful bump in our rank and file compensation as possible without some sort of undesired consequence elsewhere.
I guess all that is a long winded way of saying that yeah, more pay would be great, but how do we get there?
Eventually we will get a real talent shortage, as opposed to the pretend one we have now where employers whine endlessly about how they can’t find talent, but won’t raise wages. And when that happens, firms will be leaving money on the table by being understaffed and having to turn down work, so raising wages to attract more people will actually be the most cost-effective choice.
By the way, how come we aren’t allowed to “Like” comments now?
Is there more data on this? I was just involved in hiring an accounting manager (I work in industry), we interviewed 3 people, all 3 had 4 plus years of supervisory experience, one had a CPA, one had and MBA, and the final person had an MBA and MSA. Every job search I have been involved in we get lots of qualified individuals (even for jobs as Accounting clerks). Is the shortage exclusive to a particular region or is it more prevalent in small firms that can’t pay as well because I just don’t see the shortage.