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Talent Shortage in Accounting: Why it is Hard to Attract and Retain Top Professionals

Talent Shortage in Accounting: Why it is Hard to Attract and Retain Top Professionals

Post-pandemic, the accounting industry has started to experience an overwhelming shift in its functioning. The shift here is the challenge for CPAs, CAs, and accounting firms to retain and attract talented and skilled accountants and professionals. With the advent of technological solutions for complex accounting problems, the problem of retention and attracting new talent in the organization may escalate in the coming times. According to one report, there will be expected job openings of 136,400 for accountants, auditors, and professionals in the coming years, which is almost an increase of 6% compared to normal times.

Various factors constitute the concern of talent shortage. Some of the most well-known reasons are looking for better opportunities or retirement due to old age. However, it is necessary to address this issue with an in-depth understanding.

Why is Attracting Talented Accountants Hard?

Understanding the root cause of the problem will give insight into the problem of talent shortage in accounting. Let’s explore these causes in detail.

Change in Working Approach 

The demand for freelancing, consultation, and part-time work has grown significantly in recent years. Freelancing allows accountants to make a living on their terms without the constraints of a salaried job. As a result, many businesses are looking for freelancers or part-time accountants for accounting solutions, particularly for tasks like bookkeeping and payroll. With that arrangement, businesses have more tractability in costs, resources, and working hours while still working with talented professionals, which reduces the need for an in-house accountant in the market.

Changes in Job Expectations

Millennials are the key contributors to the growth of businesses and the economy worldwide. Therefore, they have vastly different expectations from employers where they are focusing on the remote working model.

CPAs, CAs, and accounting firms believe a remote working option will significantly increase the attraction rate of Millennials to join a particular company. Therefore, CPA firm owners offer more flexibility to hire young and talented accountants.

Increasing Reliance on Technology

Technological developments have accelerated accounting operations considerably, enabling the workforce to perform more efficiently. However, they have also restricted the scope for hiring talent for regular in-house jobs. One of the biggest technological advancements is the introduction of working virtually. A virtual working structure allows accountants and the workforce to connect regardless of their physical location, which reduces the need for employees to be available in the offices physically and enables them to connect with their peers and clients from across the globe. As a result, finding talented accounting professionals willing to stick to the conventional work model is getting harder.

Issue of Aging Workforce

Most CPAs, CAs, and accounting firms across the globe are experiencing a pervasive talent gap between the new and aging workforce and a boom in the number of the aging workforce still employed in their workplaces. Heightened competition, thanks to technology, has raised the stakes high. As a result, big CPAs, CAs, and accounting firm owners regard millennial accountants as more proficient in technology, while the aging and experienced accountants are technology averse and reluctant to learn and adapt. As a result, accounting firm owners are relieving them of their duties, disturbing streamlined operations.

These are some of the reasons that accounting firms worldwide are facing the challenges of talent shortage. However, CPAs, CAs, and accounting firm owners are looking toward accounting outsourcing to mitigate the risk and manage the business flow. Let us understand accounting outsourcing and its potential to address the talent shortage issue. 

Accounting Outsourcing for Talent Shortage

Accounting outsourcing is one of the growth strategies among many CPAs and accounting firms globally in recent times. Many accountants and accounting businesses benefit from access to highly qualified, educated workforces with tremendous industry experience. It is a profitable strategy that needs to be approached with the right mindset, as accounting outsourcing involves partnering with an external company. The conventional wisdom among many CPAs is to allocate accountancy work and expect desired results. The truth is that accounting outsourcing is not a quick fix, but a long-term investment and businesses can only benefit from long-term investment. Accounting outsourcing companies spend their time providing trials to clients so that they bring their accountants or bookkeepers to spend time on their client’s operations and thus are better able to deliver desired results. CPAs can partner with an accounting outsourcing company on a long-term contract – so that the management and the teamwork are just an extended team, can work long hours, undertake client’s work, and cater to their requirements.

Benefits of Accounting Outsourcing

Besides being a solution to the talent shortage, CPAs can benefit from accounting outsourcing. Some of these benefits include

Budget-friendly option

Accounting outsourcing provides budget-friendly accounting-related services without reducing the quality. Usually, accounting outsourcing service providers deliver their services at lower cost rates. Besides, accounting outsourcing saves money on paying the salaries of full-time employees, taxes, and office supplies.

Guidance from professionals

Accounting outsourcing service firms continuously improve their business by allocating experienced professionals to manage the client’s tasks. Successful accounting outsourcing service providers give extensive access to training to their workforce. As a result, clients have access to professional expertise. By choosing wisely, you can ensure that accounting outsourcing service providers will handle your accounting issues well.

Opportunity for scalability

The accounting outsourcing service providers have the amount of availability to scale your services significantly without any lag. Moreover, accounting outsourcing service providers charge hourly. It means clients can scale up or scale down the time easily.

Access to the latest technology

Accounting outsourcing works with automation to reduce human errors. Secondly, thanks to automation, accountants can deliver real-time reports. The software also assists in catching potential problems and resolving them. Most importantly, it will reduce the probability of fraud. Sage, Visma, Xero, Dynamics, and SAP are excellent automation tools.

Strategies for Accounting Outsourcing Services

Now that we have understood the benefits of accounting outsourcing, let us understand the strategies for successful accounting outsourcing.

  • Prepare a blueprint of services you require from the outsourcing service provider.
  • Research the outsourcing service providers and select the one that fits your requirements.
  • Understand their data security, protocols, policies, and procedures in case of any breach.
  • Establish a clear communication channel for effective workflow.
  • Once assured about the outsourcing service provider, transfer your data securely.

Final Remark

The global accounting industry has been experiencing a shortage of talented professionals for quite some time now. From the changes in the expectations of Millennials to the aging workforce in the organization, CPAs are combating at many levels, including the cutthroat competition in the market. However, accounting outsourcing provides a complete solution for accounting-related matters and several other additional benefits so that you stay ahead of the curve.

Greenbucks Accounting is a recognized accounting outsourcing partner trusted by clients globally. We have an experienced team of professionals to help you with your accounts-related issues and deliver the desired results. Drop a message for consultation or contact our experts to learn more about us.

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