A new global accountancy report has laid bare the “existential” skills crisis facing the industry – uncovering an “ever-widening chasm” between increasing demand and the shortening supply of talent.
According to the new Accounting Talent Index, a new global research study conducted and written by outsourcing specialists Advancetrack, almost half – 45% – of firms are being “severely” or “significantly” affected by skills shortages.
With the report surveying firms across continents, the figure is estimated to scale to hundreds of thousands of firms. However, even with the global economy showing green shoots of recovery, it appears there’s little good news on the horizon for accountants competing for talent.
A total of 74% of respondents said that compared with three years ago, the shortages have got significantly worse. The report said reasons for this ranged from more competition for talent from commerce firms to fewer people attending and graduating from university, as well as the effects of the Covid pandemic and an ageing workforce.
Vipul Sheth, MD of Advancetrack, said: “Our Accounting Talent Index shows how the acute lack of accountants has emerged as a critical bottleneck, and its impact has been nothing short of severe, impacting businesses, institutions and economies on a global scale.
“It’s made clear in no uncertain terms how everyone, from multinational corporations to SMEs right through to the hundreds of thousands of accounting firms around the world servicing them, are struggling under the weight of these significant challenges. It’s a perfect storm.
“Without skilled practitioners and a robust sector to oversee financial transactions, tackle regulatory complexities, and ensure compliance, the stability of modern commerce is genuinely at risk.”
The Index reveals 61% of respondents thought the Covid-19 pandemic had made an “appreciable difference” to accessing industry talent. It said smaller firms are especially bearing the brunt – largely unable to compete against the salaries and prestige offered by mid-tier accountancy firms and the ‘Big Four’, with the latter also struggling to compete against other industries.
The majority feel the Covid-19 pandemic has “accelerated trends” that were well underway before the first lockdown in early 2020, the report found.
Other straining effects firms are seeing on a day-to-day basis from the crisis include needing to pay out higher salaries, challenges in recruiting and retaining staff, limiting the services they offer and being forced to not take on new clients.
Vipul added: “Given these challenges, it’s crucial we engage with governments, industry leaders, and influential stakeholders to reinforce the critical role that accountants play in maintaining the integrity and accountability of financial systems.
“While the solutions are not exhaustive, or all yet identified, significant strides can be made by investing in the development of accounting talent, rethinking recruitment approaches, and promoting the essential role of accountants in supporting economic stability.”
Smithink Advisory partnered with Advancetrack for the report, with the findings unveiled to delegates at Advancetrack’s gbX Conference in London.
To download, you can visit the Accounting Talent Index page on the Advancetrack website here.