In the accounting recruiting and consulting industry, a topic that seems to come up relatively often is the state of the industry—and more specifically, whether the so-called shortage of Certified Public Accountants is as dire as it seems and likely to last.
The short answer: Yes, there is a shortage of accountants nationwide and it is concerning to professional organizations like the American Institute of Public Accountants (AICPA).
There’s no doubt that this shortage is affecting businesses seeking to hire accountants, including clients of TGRP Solutions. It isn’t easy to hire talent these days, and the problem has been growing for a while. Let’s dig into the data to understand the landscape.
What’s going on?
There are a few factors contributing to the accountant shortage, which can be summed up as follows:
- The surge of Baby Boomers retiring in the time since the onset of the pandemic has had a big impact on the labor market overall, and accounting is no exception. The AICPA estimated in 2015 that approximately 75% of its members would be eligible to retire by 2020. That, coupled with the impact of some younger professionals leaving the profession as well (a.k.a., the Great Resignation) has resulted in a big problem: not enough accountants.
- The American Institute of Public Accountants’ latest iteration of the biannual Trends Report (2021) shares that accounting graduates trended downward in 2019-2020 to the tune of a 2.8% decrease in bachelor’s degrees and an 8.4% decrease in master’s degrees. The Wall Street Journal explores some of the reasons for this, but the fact remains, fewer students are pursuing accounting degrees than in the past.
- The 2021 Trends report did not provide statistical projections about accounting enrollments, but the 2019 report reported that bachelor’s accounting enrollments decreased 4%, master’s accounting enrollments decreased 6%, and PhD accounting enrollments decreased a whopping 23% in 2018 compared with 2016.
- The number of candidates for the CPA exam was down 7% in 2022 from 2021 (dropping from 72,000 to 67,000). Financial Times reported in May 2023 that this was the lowest number of test-takers of the exam in at least 17 years. The Illinois CPA Society dove deep into “why” behind this in their report, “Decoding the Decline.”
What to do if your company is facing hiring challenges
The AICPA is teaming up with state CPA societies like the Colorado Society of CPAs as well as colleges/universities, the National Association of State Boards of Accountancy and others to address these challenges and build a future pipeline of accountants.
That doesn’t help companies needing to hire now, however. For clients of TGRP Solutions, it’s important to understand the landscape in order to adjust your hiring and other practices and your efforts to retain accounting/finance talent. If you’ve followed our blog for a while, you already know that Denver-area candidates are seeking the following in their future employers:
TGRP can help!
If you are seeking to hire accounting or finance professionals at your company, contact TGRP Solutions. We’ll discuss your hiring process to identify areas for improvement and get a clear understanding of the kind of candidate who will fit within your organization. If your accounting and finance processes could be improved, our Consulting practice can help you reduce the chaos with technology automation and clean up of your reporting. This can help to ensure that newly hired employees don’t inherit a mess, which can contribute to high turnover.
Call us today at 303.789.1500 to discuss your recruiting and/or consulting project needs!