KPMG Vice Chair Greg Engel has been having trouble sleeping lately. It isn’t climate change or social justice or the price of eggs keeping him up at night, like most accounting leaders he is consumed by the talent shortage. No really, that’s what he told CFO Dive.
Not to worry, Engel has hope. Hope that the ongoing layoffs in tech will scare people into accounting.
“A lot of people went to the technology sector because it was exciting. But now that Meta and Twitter and all these other companies are laying off people, kids going into college might go, ‘wait a minute, maybe KPMG sounds a little better than Twitter,’” Engel said in an interview. “Accounting is that boring, stable profession that doesn’t do as well in hugely expansive economies but does great when the economy’s on the downslide.”
If that idea sounds familiar, it should. In December the Wall Street Journal wrote about the accountant shortage and got a quote from someone at Robert Half who said: “In a downturn, students tend to gravitate toward degrees in accounting and finance because they are considered more stable career paths than, for example, marketing and communications.” Everyone is waiting with bated breath for the economy to really get ugly, because then finally firm leaders will get some rest knowing that young people are getting terrified into the accounting track and at last our talent problems shall be solved. What a strategy, eh?
Greg’s competitors at EY also thought tech layoffs would help them find talent, salivating over the idea of swathes of desperate, unemployed tech workers flocking to the safety and security of accounting firms. That hasn’t panned out so far. 79% of laid off tech workers find a new job within three months, four out of ten of them found a new gig within a month. This isn’t Grapes of Wrath with caravans of dusty programmers in American Apparel hoodies roaming the country for any work they can get. Sorry, Greg.
And this brings us back to the PR problem driving the shortage in the first place. “If things get really bad, you’ll get desperate enough to work for us” isn’t a great selling point. Especially for a younger generation who did not personally experience the joy (read: difficulty) of staying employed in 2008, it’s harder to scare people who haven’t been through something like that. Not to mention it was only three short years ago that firms cut pay and staff due to COVID (handy COVID layoff tracker here), only for many of them to turn around months later to announce record-breaking revenue. So tell us again how accounting isn’t sensitive to the economy as any other sector, Greg.
Anyway, guess we’ll see. Surely 20-year-olds picking college majors can be swayed by this argument, 20-year-olds are known for their ability to think about the distant future and their financial security after all.
KPMG primes shrinking CFO, CPA pipeline [CFO Dive]
What a joke! Who would want to be an auditor that got enslaved by the big5 if she/he had a better option?
Totally. Who would want a stable job with generally good job security, where you get promoted and make more money every year, receive benefits, work indoors in an air conditioned building, and develop skills that make you highly marketable throughout private industry, where you’ll make even more money? That sounds like a gig for LOSERS.
Tech jobs have those things but much higher pay grades than accounting. Hell, most auditors will do public accounting, then they will pivot into the finance industry and consulting. You don’t even need CPAs to be successful in finance.
Imagine being at the top of an industry where you have to hope people will be desperate enough to work for you. Fixing the shortage is easy. Raise starting pay to 75k and reduce billable hours expectations to 1,600 per year and people will be falling over themselves to take the CPA exam.
I believe there are quite a few leaders throughout corporate America who are praying for a huge recession. The inmates have been running the asylum for too long. A nice recession will employers to restore their dominance in the slave/master relationship. They can finally start cutting pay and benefits, make the help fight over table scraps and, of course, force everyone to come back into the office.
All signs actually point to our economy doing just fine, but I can’t seem to escape articles, think pieces and analyses by “economists”, industry leaders, accounting firms etc. saying that economic Armageddon is right around the corner.
I am doing a degree in Accounting and finance in Zimbabwe and can’t wait to join the industry.l think what matters is passion the rest will follow
“salivating over the idea of swathes of desperate, unemployed tech workers flocking to the safety and security of accounting firms”
Tell that to me and all my other former colleagues that got axed with no warning two years ago from KPMG and other firms
Offshoring will stagnate the pay grade for the public accounting profession. Then, automation will finish off the industry by 90%. There will be people (CPAs) staying as the last ones who can’t leave because bots can’t make judgments. However, these CPAs won’t see their pay getting better but it will likely hoover around six figures. Meanwhile, finance bros, lawyer bros, and tech bros will remain to make way more. Most CPAs in an automated world will likely pivot into other industries because their jobs are nothing more than glorified financial analysts (entry-level) at that point. I could CPA requirement is probably shaved so much to be easier to attract newcomers.
The accounting industry has lost its shine after the SOX act because big corporations were tired of CPA greed in the 20th century for overcharging them with audit & consulting fees.
Do these accounting leaders expect the laid off tech workers to come work for them in audit? Or some other service line like IT advisory or consulting? Which seems to be a healthy business line the last time I checked (and sounds like where these tech people would be naturally drawn to, assuming they want to work for a public accounting firm…)
I couldn’t think of anything worse than accountancy. The exams were useful but the rest of it is waste of aerobic gas.