By Dr. Sangeeta Chhabra
Accounting firms are focusing on the tech stack and missing out on the talent stack. Implementing new technologies is one thing; however, the talent stack needs to be upgraded in parallel.
Accounting firms are facing a talent shortage as most accounting professionals are shifting to fields like investment banking, consulting, and information technology. When an accountant vacates his job, it becomes hard to fill that void. The gap impedes their profitability and business growth, affecting deliverables. Therefore, it becomes quintessential for accountants to implement best practices to attract and retain talent.
Why it is difficult to find good accounting professionals?
Accountancy is a challenging labor market. Fewer people are entering this industry, and accounting professionals in their 20s and 50s are leaving fast. The industry’s value proposition is losing ground.
U.S. accounting firms are experiencing a crisis, as only 1% of them are able to find good staff. The Wall Street Journal reports that more than 300,000 accountants and auditors in the U.S. have vacated their jobs in the last two years. Most accounting firms don’t have enough measures to respond to this need.
Attracting and retaining talent
In this post, we will discuss a few levers that accounting firms can employ to attract and retain talent.
1. Focus on the financial stability of the staff: Accounting firms cannot afford to pay lower salaries to their professionals. A recent report from Thomson Reuters highlights that 94% of new accounting practitioners now choose financial stability as their ulterior goal. Moreover, 93% now believe that competitive salary matters the most for them.
| Accounting Professional’s Level | Salary Reported |
| Accounting professionals (new entrants) | $80,000 to $99,000 in a year |
| Accountants with 2-3 years of experience | Over $80,000 |
Accounting firms looking to retain talent should ensure that they pay salaries to their new hires or risk losing them. Competitive and living compensation demonstrates that the organization values employees’ contributions and validates its steadfastness toward their well-being.
2. Incentivize employees: Offering attractive benefits can help accounting firms retain staff. To stay competitive, firms should elevate their benefits packages by including features such as competitive 401(k) matching, comprehensive retirement packages, health days, meal allowances, and leadership development opportunities.
Additionally, it is crucial to recognize employees for their contributions on a regular basis. Doing so not only motivates those acknowledged but also serves as an excellent motivator for other employees who have yet to be recognized. Regular recognition and associated performance-based rewards foster a positive work environment, enhance employee morale, and encourage a culture of excellence.
3. Provide flexibility: Young job seekers look for flexibility and a greater degree of autonomy at work. COVID-19 has only become a force multiplier of these aspirations.
They don’t prefer spending the entire day in the office working on trial balance data, engagement software, or formatting statements. Accounting firms are responsible for creating a flexible work schedule that ensures the staff is not bogged down with work.
Cloud-based work environments can help accountants work from home and enable an ecosystem conducive to growth. Implementing a new-age cloud accounting setup to boost productivity and employee morale is imperative for accounting. These technologies promise to simplify and accelerate processes and improve profit margins.
4. Set up open and transparent communication: Some accounting firms limit themselves to one or two meetings per quarter to reach out to their staff. However, this is insufficient. To build trust and foster a strong sense of community among staff members, accounting firms should establish a system of open and transparent communication.
This could include regular meetings, feedback sessions, and accessible channels for ongoing dialogue. Frequent and honest communication helps ensure that employees feel heard, valued, and engaged, ultimately leading to a more cohesive and motivated workforce.
5. Increase workplace diversity and inclusion (D&I) efforts: Every talent expects a safe work environment, equitable treatment, and healthy work culture. That’s why accounting firms with a good track record for D&I efforts can attract and retain good talent.
There are various things that an accounting firm should do to prevent staff from slipping through the gaps:
- Rethinking pay structures
- Imparting training at all levels
- Chartering policies that create an inclusive work environment
The leadership should be able to think clearly about a roadmap that connects organizational as well as employee’s values and brings them on one single mission. Another relevant thing is factoring cohesion among staff through employee engagement activities.
6. Build capacity: Another relevant area to focus on is capacity building, and smart accounting firms specialize in this. They know where the value or potential lies and know which pathway will take all their employees and the accounting firm there. The trick is not to prepare employees for their current roles. Instead, it focuses on training employees for their next roles.
They should focus on setting up benchmarks or milestones and guide employees’ career paths toward success through training, coaching, mentoring, and assignments.
7. Rethink the existing recruitment and retention strategies: Accounting is a fast-changing realm. There is no guarantee that “what works today” will deliver similar results tomorrow. It is important to review and reinvent talent management processes for the best results.
Accounting firms should rethink the archaic hiring and retention strategies that are no longer yielding positive results. To do this consistently, leadership should reserve the calendar for reviewing staff development, strategic thinking, and change management processes.
Conclusion
The key to thriving in a tight labor market is to establish an intentional model that creates a symbiotic alignment between leadership, staff, and the organizational vision. There are no shortcuts to this, and the path is often complex and multifaceted.
Business leaders must consistently engage with employees through regular check-ins, surveys, and open forums, ensuring that communication is a two-way street. Promptly responding to feedback demonstrates a genuine commitment to addressing concerns and improving the work environment.
ABOUT THE AUTHOR:
Dr. Sangeeta Chhabra, co-founder and director of Ace Cloud Hosting, is a leader and innovative entrepreneur with more than 20 years of experience in the IT sector. She has positioned the company as a leading global provider of IT and managed cloud services, celebrated for its QuickBooks hosting tailored for the accounting sector, as well as its Managed Security Services and Public Cloud offerings for SMBs and enterprises. Under her leadership, Ace Cloud was honored as the Best Outsourced Technology Provider at the CPA Practice Advisor Readers’ Choice Awards 2023, among other accolades. Beyond her professional successes, Dr. Chhabra is a passionate advocate for women’s empowerment and is committed to fostering an inclusive environment at Ace Cloud.
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Tags: Accounting, Firm Management, Payroll, Staffing
