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If you want an occupation with iron-clad job security and salaries rising to historic heights, look no further than accounting – there is a widespread shortage of accountants in the U.S. market.
Over the past twenty-five years, the number of people choosing to become accountants plummeted while demand has greatly increased. The result is a perfect storm that has salaries increasing at a noticeable rate. That puts the job seeker in the driver’s seat and the employers riding in the way back of the family station wagon. What happened?
According to Kevin Suksi, an accounting recruiter (and CPA-certified accountant) and partner at professional search and management consulting firm Orion Solutions Group, the path to becoming a Certified Public Accountant evolved. Around the year 2000, the baseline was a Bachelor’s degree in accounting (30 credit hours), two years with a CPA firm, and passing the CPA exam.
In the past, a first-year CPA could expect a lot of menial grunt work and long hours to learn the foundational skills they would need to tackle more advanced accounting challenges in their professional future. Accounting automation changed that, with new software coming to market that took care of much of that menial grunt work recent graduates were required to do to learn the intricacies of their craft and prepare for the CPA exam. For example, (spoiler alert: accounting lingo to follow) confirming accounts receivable, a process, that once required a great deal of manual time and effort (i.e., work!) could now be mostly accomplished with a couple of clicks. Much of the mundane work that a first-year staff accountant traditionally performed was eliminated.
Automation created efficiencies but resulted in a workforce with less real-world accounting experience to help them develop the necessary skills to move to the next level. And so, for first-year accounts to succeed, it was determined that they would need to arrive at their first job with more advanced skills.
Hence, the requirements to become a CPA became more difficult, with the resulting barriers to entry. Instead of just a Bachelor’s degree in Accounting (120 credit hours, including 30 credit hours in accounting), newly minted graduates would then need additional education (150 credit hours, including 30 hours in accounting), or the rough equivalent of a master’s degree, a full year at a public or private firm reporting to a CFO or controller, and, of course, passing the CPA exam. Salaries, however, only increased moderately – with potential accounting students who did an ROI calculation trending toward other disciplines.
Meanwhile, the cost of college skyrocketed. If you wanted to be a CPA, you needed the resources to cover 150 credits instead of 120 and starting salaries weren’t (and until recently, hadn’t been) rising with the price of admission. The seeds of the current accountant shortage started to be sown.
Then, in response to corporate accounting malfeasance, Congress passed the Sarbanes-Oxley Act (SOX), which made it much more difficult for businesses to fudge the numbers.
SOX upended the accounting profession. The law was complex and labor-intensive, with gains from automation quickly erased by increased reporting, while also accompanied by stiff penalties for fraud that made financial professionals liable for the numbers they presented. Companies wanted massive testing to ensure the financials were proper and that required manpower. Technology alone wasn’t going to cut it. Demand and salaries shot up and the Sarbanes-Oxley Act got a nickname – the Auditor Full Employment Act.
High demand? Rising salaries? More elevated status? Perfect, right? Not quite.
All this extra work and pressure to comply with SOA’s legal requirements meant an accountant could expect rigorous (and very long) work weeks, work-life imbalance, and the increased potential of criminal liabilities.
College costs continued their year-after-year increase with more and more students going into debt to get once-coveted degrees.
Technology fields rose to dominate almost every level of the global economy, influencing college students’ career decisions. A future professional who may have chosen the accounting field twenty years ago could now take a job with Google, for example, with a higher starting salary, a forty-hour work week, greater work-life balance, no potential criminal liability, and, let’s face it, a sexier job.
More recently, the COVID-19 pandemic resulted in a paradigm shift in the way people think about work and what they’re willing to sacrifice for them. If you were given the choice of creating algorithms for Spotify with a hybrid work schedule or laboring to complete a complex audit in your cubicle at 3:00 am, which would you choose?
That brings us to the present day. The only thing higher than the demand for accountants is the salaries companies are willing to pay to obtain them, and accounting remains a profession with solid job security – great enticements that are hard to match.
While the rigors of the accounting profession and the long work hours make it less attractive to future professionals who have more choices and more demands, for someone willing to put in the time and effort there is job security and a pot of gold at the end of the accounting rainbow.
Philip Roufail contributed to this article.
Scott Singer is the President and Founder of Insider Career Strategies Resume Writing & Career Coaching, a firm dedicated to guiding job seekers and companies through the job search and hiring process. Insider Career Strategies provides resume writing, LinkedIn profile development, career coaching services, and outplacement services. You can email Scott Singer at scott.singer@insidercs.com, or via the website, www.insidercs.com.
