Staff shortage omnipresent in the US accounting firms in 2017

Staff shortage omnipresent in the US accounting firms in 2017

Posted by  on 12 May, 2017  5 minute read

It is quite obvious that employees drive not only business growth but also brand awareness; and when even one of them resigns, it leaves the company with the massive task of onboarding and training a new hire so that (s)he can immediately start contributing efficiently.

The accounting profession has evolved by leaps and bounds. Globalization, technology, and rapid pace of change in tax laws and regulations are just a few elements that have ensured the growth of and change in the industry.

Just like other professions where employees have to undertake training to match up to the evolving trends in their industry, the CPAs too are consistently on their toes to ensure they keep themselves updated, give timely exams and find solutions to do a better job.

But not all is hunky dory in the accounting profession. Many businesses are struggling to retain employees they hire to perform general accounting duties. According to a survey report by the Benchmarking the Accounting & Finance Function 2017, 62 per cent of respondents reported their accounting and finance teams were somewhat understaffed.

This is not shocking at all, given how the accounting industry is marred by “understaffing” since long. And it is not just the big leagues (with more than $5b in revenue) complaining about not having enough CPAs to work with them.

One-third of the smaller companies that generate revenue of not more than $25m are also not happy with their staffing levels. So you see – understaffing is omnipresent in the industry. Adding to this, here is what we think is causing staff shortage across CPA firms:

  1. Bye-bye baby boomers

    One reason for the decline in staff retention is due to the growing number of baby boomers who are on the verge of retirement. There is lack of leadership and succession in the top management, and that has hampered the way the functioning of lower divisions in the companies.

  2. Embracing automation

    This is the age of automation. Naturally, companies are able to achieve a lot more, cost-effectively and in a shorter period of time, with the use of the right software. Technological disruption is in the process of displacing much of the traditional tasks performed by CPAs. In simple words, “manual labor is out; technology is in.”

    Also read: What to watch out for in the accounting industry in 2017

  3. Millennials are picky

    The “kids” from the new generation crave instant gratification – both personally and professionally. If they are not happy at work, they switch without blinking an eye and hop on to the next job. Reasons to switch are many – dreadful managers, never-ending management disputes, lack of training, zero work-life balance, etc. etc.

  4. Lack of career development framework

    It is extremely important to undertake training programs for all lines of the business, across departments. Employees want to see how their role with develop in your company. Accounting firms need to ensure that the employees will get adequately trained – whenever and whenever possible.

    Gone are the days of data entry and bookkeeping. Today, accountants should be able to provide extract the data, analyze and provide insights – which is drastically different from what they have been doing so far. Moreover, it is important to give them the opportunity in areas that interest them.

    Career development is not possible without investment, and accounting firms should be prepared to do that.

    Also read: The art of attracting and retaining millennial CPAs

Our solution: Partner with us
You may not know this but more than 25 per cent of the accounting firms in the States take assistance of third-party bodies and temporary professionals to perform accounting and finance activities. In fact, the same report states that 31 per cent of the companies in the States outsource the tax function.

Just like the accounting industry, the outsourcing practices have also evolved; and tax and payroll are two functions that CPA firms have majorly outsourced. Having said that, we are delighted to offer our professional accounting services on a project basis to handle your overflow work.

We believe that having a professional resource partner can help you accommodate new business coming in during the next financial year, increase profit margins, allow for unrestricted scalability – without having to worry about staffing issues!

What are your thoughts on this? We would love to have a quick chat with you. Call us on +551 227 8165 or write to us at contact@qxas.us.com.