outlook & analysis

when will accounting firms be ready to start hiring again?

firms maintain headcounts 4% smaller than last year and 8% off pre-recession peak.

by rick telberg

while the rest of the u.s. economy shed 131,000 jobs in july, sparking fears of a double-dip recession, rosters at accounting and bookkeeping services remained unchanged from the month before at a seasonally-adjusted 893,200 workers. that’s the good news.

accounting and bookkeeping services, total employment (by month, in thousands)

the bad news:  july’s employment for the industry represented a 3% decline from the year-ago month, and, possibly, an acceleration in job losses because the 3% year-to-year decline in july followed a 2.8% year-to-year decline in june, 2.9% may-to-may, and 1.8% for both march and april.

seasonally-adjusted total industry employment peaked in january 2008 at 970,100 workers, making the workforce in july about 7.9% smaller, according to the latest employment situation report from the u.s. bureau of labor statistics.

without the seasonal adjustments, the bureau of labor statistics counted 818,000 employees at accounting and bookkeeping services, representing a fractional decline from june’s 818,400.

accounting and bookkeeping employment, not seasonally adjusted

year to year, july’s 818,000 number represented a 3.4% decline from the year-ago july and the lowest number since 1.099 million in february 2008.

in cpa firms specifically, the bls counted a non-seasonally-adjusted 391,700 employees for june, the latest month available, representing  a marginal decline from may’s 392,700 and a 3.7% drop from the year-ago month. employment peaked at cpa firms with 445,400 employees in february 2008.

cpa offices, all employees, thousands

at tax preparation services, non-seasonally-adjusted employment sank to 50,300 workers, down 19% from the month before and 5.8% from the year before.

tax prep services, all employees, thousands

payroll services continued their long, bumpy decline in june with 152,400 workers, a 0.7% dip from may, but a 0.5% gain from the year-ago month.

payroll services, all employees, thousands

in the bls’s catch-all “other accounting services,” june employment declined 1.1% to 224,000 from may and 5.8% from the same month a year before.

other accounting services, all employees, thousands

so when will firms start hiring again?
tell us in comments.

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12 responses to “when will accounting firms be ready to start hiring again?”

  1. edward greenlee

    i’ve noticed a few comments on “busy season”. when i started in 1985 we had monthly work and tax season was just a bonus. now tax season may be 80% or more of the annual revenues. this places alot of stress on personnel and cash flow.

    as just one chairman of the aicpa’s personal financial planning section, we ae planning on discussing various business models that may alleviate the constant revolving door of personnel staffing.

  2. accounting jobs los angeles

    we are definitely starting to see some improvement in job market. there has been an uptick in job postings. we still have a ways to go but there are some positive signs.

  3. rich kane

    to: alan portnoy,,,
    am very interested in chatting with you. i’m in the same boat.
    rich
    r_kane@comcast.net

  4. alan portnoy

    rick,

    i made a decision after being downsized in march and started my own practice as a sole practitioner in may.

    i could have tried and joined another firm, but at that time months from turning 50 and not wanting to spend 3 to 6 years as a manager (maybe) i decided to give it a try.

    -alan

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  6. jackson

    hi, i’m seeing a slower aggressive hiring practice for mgr level, but we are hiring new juniors at almost the same rate as pre-recession. also out internship program was at the same number (seen as very critical to the new associate group). so it seems more cautious, but not overly. the turnover will still be there and that needs to be considered.

  7. alan bahr

    my firm is in a small, relatively rural community which, like so many , has been invaded by the “big-box” retailers who have pushed out most of the local businesses. of course, the large chains have their own accounting and payroll systems, and have no use for local accounting firms. since there are fewer local businesses, there is less need for local firms, too. and, so many of the remaining local businesses use cheap accounting software (on which they can make errors 10,000 times as fast as with manual systems), so they think the accounting fees should be reduced because they “have already done all of the work themselves”.

    in short, we do not ever see the opportunity to hire any accounting personnel.

    we could still use seasonal tax preparation people but, even in these times of high unemployment, cannot locate enough conscientious prospects to fill all of the positions. that need will probably also diminish in the future, due to online filing availability–if the software is online, why pay a professional?

  8. mentioned on twitter by del devries http://bit.ly/cyvyoh

    mentioned on twitter by del devries http://bit.ly/cyvyoh

  9. rob ignasiak

    a contributing factor for the hesitation to hire is the difficulty in managing and predicting cash flow this year. clients are continually extending payment of invoices regardless of whether they are distressed or performing well. i have received similiar feedback from other cpa firm managers as well as law firms.

  10. geremy cepin

    rick,

    thanks for all of the great information you provide on a daily basis. i am a reader of your blog and follower of your twitter updates.

    in regards to today’s article titled when will accounting firms be ready to start hiring again?; we are seeing a huge uptick hiring in hiring by accounting firms of various sizes across the u.s. for tax, audit, and marketing/sales positions. currently my firm, pdi executive search – a division of pdi global, inc. (our president, allan koltin has been named one of the professions most influential people for each of the last 10 years) – is currently engaged by 12 different cpa firms to recruit for tax partner, senior tax manager, tax manager, audit partner/senior manager, director of practice growth, and business development executive positions. in fact, just yesterday a regular client called for help in recruiting two tax managers with outbound international tax experience.

    not all of the positions we represent are in specialty service lines. many of them are for private client services, serving privately held corporations, partnerships, and high net worth individuals.

    these positions i speak of are in cities including san francisco, seattle, chicago, northern virginia/washington d.c.. philadelphia, new york city, los angeles, and boston. all provide tremendous career growth opportunity.

    rick; just thought i’d give let you in on what we are seeing in the marketplace. the tide has definitely turned for the better.

    best regards,
    geremy

    geremy cepin
    national director
    pdi executive search

    625 north michigan ave., suite 2100
    chicago, il 60611
    312 245 1755 (o)
    312 810 2777 (c)
    gcepin@pdiglobal.com
    http://www.pdiglobal.com

  11. mentioned on twitter by nancy byerly jones, stefanie dewilde, william barefoot.

    mentioned on twitter by nancy byerly jones, stefanie dewilde, william barefoot.

  12. kelly edwards

    hopefully, we’ll be adding on more people for busy season. if we don’t, i don’t know how we’ll handle the work. we’ve been cut down to the bone.