For the first time in world history, the gap between demand and supply in the accounting industry has reached alarming levels. Accounting professionals across the globe are switching careers, the number of individuals taking CPA exams is drastically decreasing, and the majority of veteran accounting professionals (75%) are approaching retirement age.
As a result, the talent pipeline is drying up, and existing resources will soon be exhausted. Experts warn of a global accounting shortage crisis unlike anything we’ve seen before. (As we discussed in our blog here).
Consequences, Reasons & Ways to Tackle the Accounting Talent Shortage
Our last blog highlighted the key issues stemming from the shortage of accounting talent, from longer turnaround times, inaccurate budgeting, and increased workloads to limited capacity for strategic planning and higher costs of accounting services. You can find them here.
In today’s blog, we want to understand the reasons behind the accounting talent shortage and why the most effective way to tackle this issue is to identify its root causes first.
As a remote accounting firm that has faced these challenges for more than two decades, we’ve easily tackled them. In the subsequent sections, we’ll provide tips on addressing and solving these problems. So, read on:
Reasons behind the Accounting Talent Shortage
- Declining Interest in Accounting: Perceived long hours and less exciting pay contribute to a decline in interest in accounting, which has long been considered a promising career.
- Less-Attractive Pay Structure: The rise of technology has drastically influenced average salaries, impacting the cost of living in various cities. What is considered a decent wage for an accountant is often below expectations, leading many to switch careers.
- Career Switching: Long work hours, stress, and less attractive salaries are prompting many individuals to switch careers, which places an additional workload on existing accountants and exacerbates the shortage.
- Aging Workforce amid Increasing Demand: Most accounting workers are nearing retirement age, significantly reducing the available workforce. This happens while the demand for accounting resources rises, worsening the gap between supply and demand.
Adapting to the Accountant Shortage – Tips for Accounting Firms
All the above factors have been brewing for the last few decades, culminating in a global accounting talent shortage. Accounting firms, driven by skilled talent, are among the most affected by this crisis (we experienced it too). So, how can they adapt to the global accounting talent crisis and safeguard against this impending danger? Let’s find out:
Invest in Accounting Technology
The fastest and most effective way to address the consequences of the accounting talent shortage is to invest in advanced accounting automation tools. By identifying manual processes that can be automated, firms can significantly reduce the time spent on tasks that currently require long hours. While many accounting firms already utilize automation, it is important to rethink workflows to further increase the scope of automation.
Rethink Accounting Workflows
Existing accounting workflows often center on manual processes. By leveraging automation tools, firms can streamline operations and reduce the burden on their teams. By rethinking our workflows at our accounting firm we made significant improvements in identifying the works that can be automated.
After identification, consider outsourcing non-core functions and structuring accounting tasks to work more efficiently without relying heavily on in-house resources.
Prioritize Talent Development
While the above strategies can address current issues, firms must proactively develop in-house talent. Upskilling existing staff through training and development programs helps accelerate growth and cultivate future leaders, ensuring a sustainable talent pipeline.
Improve Employee Experience
Outsourcing non-core functions and rethinking workflows can save time and resources while reducing costs. This not only enhances employee experiences but also improves work-life balance. A positive company culture that acknowledges and rewards employees fosters an environment conducive to retaining top talent.
Leverage Remote Accounting Partnerships
Collaborating with other remote accounting firms can effectively mitigate the talent shortage challenges.
- One can replenish the talent pipeline by partnering with universities and accounting schools. Offering internship programs, training courses, and advanced training initiatives not only enhances goodwill but also helps retain the best existing accounting talent.
- By partnering with trusted firms, you can outsource non-core functions, increase productivity, and reduce costs. Finding the right remote accounting partner with comprehensive support is critical to overcoming the talent gap.
If you’re an accounting firm looking to grow through a remote accounting partnership, consider collaborating with experts experienced in providing on-demand bookkeeping and accounting services.
As a leading remote accounting firm, Outsourced Bookkeeping has partnered with top professionals worldwide to deliver exceptional support across all areas of accounting. You can find out more about our services here.
