the great resignation: five reasons accountants are quitting

and five strategies for addressing attrition – before it strikes.

gauging the staff shortage:
how are accounting firms adapting?
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by bill penczak

firms are getting nervous and with good cause. as they plan for the 2022 busy season, audit and tax departments are realizing they may not have the resources to staff their jobs already on the books, much less any new work that comes about in the fourth quarter of 2021.

more on the staffing crisis: the digital toolset for hiring at a small accounting firm  |  learning how to hire amid covid  | how covid rewrites the rules for recruiting | new covid strategies for staff recruiting and retention | irs has recruiting problems, too | 12 signs it’s time to outsource | how aging boomers impact the accounting profession | why remote workers need retreats |

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there’s been a lot written in the past few months about the great resignation, but the turnover problem in cpa firms has been endemic before the pandemic. one recent report finds that turnover in the top 50 firms is 17%, and one in every six firms experiences an annual turnover of 20 percent or more. that means that one out of five people who attend the busy season kickoff event won’t be around for the next one.

here are five reasons your people are quitting your firm for other firms, for a job in industry, or to become a citizen of the gig economy and work virtually from a beach in thailand:

1. culture—according to careerexplorer, accountants are among the unhappiest professionals, and rate their career happiness only 2.6 on a 5 scale, placing them in the lowest 6% of all careers.

while the work at times can be interesting and challenging, much of the challenge is due to long work hours, unreal expectations, and lack of communication (more on that later). smaller firms, in general, have more of a family atmosphere; the larger the firm, the more that your staff will feel like a cog in a wheel.

one way to address your culture on a systemic basis is by making a true commitment to your firm’s mission, vision, and values. while many firms have some form of a values statement, few actually live their values, talk about them on a regular basis, or hold each other to those standards. the reason may be that accountants are not typically “touchy-feely”, but that’s exactly why values are important. the other consideration is that the workforce has changed, and more younger people are concerned about social justice, equity, and mission than generations before them.

one of my clients, a cpa firm in houston, recently recast their mission, mission, and values, and subsequently conducted a four-week study on deepak chopra’s book “the soul of leadership,” and over the summer a five-part series on mindfulness and meditation. each curriculum was tied back to the firm’s four key values. both programs were well-received and well-attended—even though it was out of the comfort zone for many.

2. smart people doing stupid work. an audit partner recently confided to me “i’m glad i don’t have to do that mindless inventory #*$% like we make the staff do each year”. shame on her.

take a step back for a moment to consider the scenario to which most firms have become accustomed: you hire kids who are smart enough to attend college, earn a rather difficult accounting degree, and an even more difficult cpa certification, and then put them to work completely mundane and non-challenging tasks.

some more progressive firms have addressed this issue by offshoring some tasks to low-cost countries, just as the big four firms have been doing for decades. while the initial attraction is cost savings and margin improvement, the other benefit is relinquishing the tasks that are driving your people away to industry.

3. inefficient work delivery processes. in a recent survey, nearly half of those polled about their client accounting services practices indicated they were dissatisfied with the way their practice operates.

in this case, firms cited a lack of practice-wide processes, “one-off” solutions, and other inefficiencies that not only cost money but foster employee dissatisfaction. while technology solutions and workflow tools can address some of these issues, firms would be well-served to examine how work is being done and how it could be done better. this is not a simple task, and firms might consider creating task forces for those on the front line to address these issues. the benefit is two-fold: repairing the inefficiencies, and the buy-in and extreme ownership by the staff on the front line.

there are consulting firms that specialize in process and technology improvement and can guide your firm through the process and provide an agnostic view on platforms and processes (unlike software vendors who have a dog in the hunt).

4. poor communications. your people aren’t leaving for more money, they are doing so because of a poor relationship with their immediate supervisor.

while firms spend lots of time and treasure on technical training, few put the same value on soft skills such as conflict resolution, time management, and other essentials that foster a better working environment. public accounting professionals are under pressure for nearly half their working year, and poor communications and toxic environments only contribute to the stress and the propensity for people to leave.

5. ambiguous career paths. it’s not selfish for your staff to ask the question, “what’s in it for me”? whether boomers (me included) like it or not, the younger generation is not complacent and wants to know the next step in their careers.

granted, some younger staff may overestimate their technical or management skills and think they should earn the brass ring of partnership in a year or two. it is therefore incumbent on partners to spend the time to cultivate and coach their people and work with your hr department to define a clear and achievable growth path—whether it be to partner or not. coaching programs (by coaches who are not direct supervisors); organized peer discussion groups; and kpi-driven metrics are keys to clear career paths.

retention has been an issue for many years in the industry, and the pandemic has only exacerbated the turnover issue, as people have had more time to contemplate their futures, their purpose, and even their career choices.

but managing partners and firm leadership can stop the bleeding with a focused approach to the underlying issues that cause people to leave.

posted on october 7, 2021