An actual shortage?
The issue of a potential accountant shortage has been a topic of discussion in hiring and news circles for several years. Recently, a WSJ article highlighted the matter after several publicly listed US companies identified "material weaknesses" due to turnover in critical accounting positions.
There is evidence to suggest that an accountant shortage may be a valid concern. According to one source, there has been a 9% decrease in the number of students earning accounting degrees over the past decade. Moreover, employed accountants and auditors experienced a 17% decline from their 2019 peak, with many Baby Boomers and younger peers leaving the industry. While there are various factors contributing to this talent decline, long hours and poor compensation are often cited as leading causes, with many aspiring accountants moving to adjacent industries such as tech and finance.
Additionally, the accounting industry is experiencing increased demand for specialized skills due to changes in the accounting landscape, technological advancements, and greater financial regulation complexity. Consequently, a broader range of skill sets is required to fulfill the growing demand, which further compounds the talent shortage in the job market. Industry reports indicate that demand for accounting professionals is expected to remain strong, with job openings for accountants and auditors projected to grow by 6 percent from 2021 to 2031. Although OpenAI's "TaxGPT" demonstrates the potential for AI in tax, it appears that the market is not yet ready to hand over tax duties to automation.
To mitigate the impact of talent pipeline issues on growth, what measures can accounting firms adopt? In addition to offering competitive compensation, software solutions can significantly enhance productivity and facilitate better employee experience.
Building a Modern Firm with Cloud Software
In the wake of the COVID-19 pandemic, the accounting industry witnessed a significant shift to remote work, which not only brought about a new level of flexibility for accountants but also underscored the importance of technology in keeping businesses running smoothly.
Embracing cloud-based practice management and accounting systems has become essential for modern firms to stay competitive, not just for serving clients, but for ensuring employee satisfaction and retention. These systems keep teams in sync by enabling collaboration and real-time access to information from any location. This gives existing employees flexibility for remote or hybrid work, and greatly expands the talent pool, allowing firms to hire from anywhere. One survey revealed that when people have the chance to work flexibly, 87% of them take it.
Effective implementation of software also allows firms to scale their services exponentially while keeping headcount growth linear. As teams become more productive and busy work is replaced with value-add work, firms can bring on more business with fewer employees.
Automate the Mundane
Most accountants spend half of their time on administrative tasks, taking focus away from their core expertise. Practice management systems can enable your firm with automation capabilities, putting your back-office on autopilot and freeing your team to work on high value tasks that improve client services, employee productivity, and employee satisfaction.
Requests for client documents and follow-ups can be automated through predefined workflows, ensuring timely responses and reducing the risk of missed deadlines due to missing client information. An integrated project management system can create tasks for accounts based on templates, so you can standardize your operating practices and ensure your clients all receive the same level of service, even as you scale and bring on new employees.
By harnessing the power of automation, accounting firms can optimize their workflows, focus on value-added services, and deliver enhanced client experiences.
Scale with a Digital Concierge
In an industry where building strong client relationships is vital to the success of a firm, a client portal can increase your team's capacity for more meaningful interactions, reducing the need for routine status updates and requests for missing documents. A customized client portal allows your clients to collaborate with their accountants and access real-time updates on projects. A client portal streamlines document collection and centralizes information shared by the firm, providing a user-friendly platform for data management for both employees and clients.
A client portal benefits accounting firms by enhancing overall team efficiency, fostering stronger client relationships, improving client experience, and providing a competitive edge in the marketplace.
Add AI to your Stack
While AI is not likely to replace human accountants anytime soon, it can provide significant benefits to accounting teams. Large language models, such as OpenAI's ChatGPT, are particularly adept at processing vast amounts of text and accurately answering questions. Although it is early days for this technology, there are already a number of ways your firm can take incorporate it in their workflows:
Document summarization tools can quickly extract key information from lengthy documents, saving accountants hours of reading to find important details.
AI-powered help desks can address common client inquiries, providing instant responses and freeing up employee resources for more complex issues.
AI-powered knowledge bases for employees can reduce the time and support needed to onboard new team members. By leveraging AI to augment existing processes, accounting firms can boost productivity and efficiency while also reducing costs.
Accounting firms can overcome talent pipeline challenges by leveraging technology to keep scaling their business. Cloud-based systems, automation, client portals, and AI-powered tools enable your employees to work more efficiently while maintaining exceptional client experiences. As the industry evolves, technology will play an increasingly important role in shaping the future of accounting. Firms that embrace this reality and invest in innovative solutions will be best positioned for success.
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