The Accounting and Corporate Finance industry is facing an accountant shortage. While the job market has been growing steadily since the recession of the 2000s, many financial institutions have struggled to find qualified talent to fill their ranks.
This disparity could spell trouble for the industry, where even advanced technology has yet to replace the decision-making power of the human mind.
What is the reason for this accountant shortage? What can be done to remedy the situation? In this post, we’ll address these two questions, while also offering practical strategies for retaining qualified workers.
Why is There an Accountant Shortage in 2021?
The CPA shortage doesn’t stem from any one factor. Instead, it represents something of a “perfect storm” of issues affecting the industry. Here are several reasons why there is a growing shortage of accountants in the workforce today.
Mass Exodus of Retiring Accountants
Now that they’ve reached retirement age, Boomers are leaving the workforce. This is true in every industry, of course, but without the ability to attract and retain younger workers, this growing exodus will only widen the gap between the job market and the pool of available candidates.
Assumptions About Technology
As we hinted earlier, there’s been an assumption that some portion of accounting processes can easily be handled using automated processes and advances in accounting-related software. Even the word “bookkeeping” seems quaint when financial work is often conducted through a screen.
But no technological advancement can replace the need for human judgment. In some cases, legal stipulations may require that a human professional make decisions regarding the company’s books.
Too Many Specialists, Not Enough Generalists
College graduates often come to the workforce unprepared. While their academic coursework may have been rigorous, their training has been so specialized that they lack the general business skills that many CFOs are looking for.
The Profession’s Branding Issue
Ultimately, there are not that many young adults pursuing a career in accounting. According to a 2019 report from the American Institute of Certified Public Accountants (AICPA), the number of students taking the CPA exam has declined precipitously in the last 10 years.
This CPA shortage could be due to the profession’s “image” issue. Boomers often malign millennials as being overly eager for promotions and status. The truth is that many millennials want a rewarding career that lets them leave a mark on the world.
Many of these same young adults grew up hearing about financial scandals and corruption, which has made it difficult for them to seriously consider pursuing a career as an accountant.
How to Attract and Retain Accountants
The accountant shortage will only worsen unless more young adults are brought into the accounting profession. What are some ways that accounting firms and corporate finance departments can attract and retain more young professionals?
Offer a Sense of Purpose
Today’s emerging adults want to change the world. At first glance, the world of accounting often seems to be merely clerical. This gap must be closed to encourage more young people to consider accounting as a career.
Accounting firms and departments will have to offer applicants a broader purpose than just “keeping the books.” Young adults will be attracted to organizations whose values match their own, especially ones that can connect their employees to the company’s larger purpose.
Offer Remote Working Options
Millennial workers want a greater work-life balance. One way to achieve this is to offer remote working options. This doesn’t have to be a permanent remote arrangement, but young adults will appreciate greater flexibility in their required office hours.
Offer a Clear Path to Advancement
For many new accountants, their first job is a stepping stone for their entire career. Unless your company can provide a clear path for their future, many young adults may simply step from a job to join another company.
Additionally, college students must be able to visualize a lifelong career in accounting before they’re willing to commit to a costly education.
Does the Future Lie in Outsourcing?
Traditionally, companies have relied on a staff accountant to help manage their books. But the American business landscape is shifting. Many businesses have found it to be more cost-effective to outsource their accounting needs to private accounting firms.
In the years ahead, we’ll almost certainly see more of this trend. An accounting firm is ideal for today’s specialized graduates, who can use their professional skills without being burdened with “other duties as assigned.” While specialization can be problematic when a person is working for a company that expects diverse qualifications, a highly specific skill set can be an advantage in the world of outsourcing.
Accounting and Today’s Job Market
There is no one-size-fits-all solution to dealing with the accountant shortage. While technological innovations have helped to close the gap, there will always be a demand for skilled workers. If you know a young adult, encourage him or her to consider a career in accounting. In an unstable job market, this career path just might offer some stability and purpose.
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