CPA Firms Hiring Challenges and How to Overcome Them

The USA is facing a high accounting talent shortage these days. Amidst this, the demand for skilled accounting professionals is rising due to the need for the regulatory framework surrounding the accounting realm as well as the necessity of the clients. However, CPA firms do not pool from where they can hire skilled CPAs, which has led to a talent gap within the industry. This has increased CPA firms hiring challenges.

Furthermore, based on statistical analysis, the current market of accounting professionals in the USA shows that around 80% of accounting firms are facing a severe shortage in staffing and struggling to find qualified professionals for accounting. Additionally, there has been a smaller number of professionals choosing the accounting landscape. Thus, around 75% of practising CPAs are near their retirement age. In addition to that, almost 2/3rd of hiring managers in finance and accounting are looking for talent to fill new roles, and 32% are focused on staffing vacated roles. However, at the same time, 95% of them are facing difficulty in locating skilled talent available for hire.

Moreover, many authorised organisations have released data showing that along with the accounting talent shortage, there has been a significant decrease in talent quality as well. Furthermore, fewer people have been taking the CPA exam in recent years, which is also a primary reason for the scarcity of accountants.

1. Common Recruitment Challenges Faced by CPA Firms

We know that recruitment is an essential part of any business, including CPA firms, for operations and growth. However, CPA firms in the USA are facing various challenges that are making their recruitment processes and decisions worrisome.

A few CPA firms hiring challenges are provided below:

Competition for Skilled Talent

We know that irrespective of any industry, the hiring environment is very competitive, as is the case for accounting and financial professionals, as many hiring managers are seeking to hire skilled professionals. In addition, due to the scarcity of professionals, the hiring of skilled professionals has become more competitive and difficult for CPA firms to hire top-class professionals.

Time-Consuming Process

Businesses know that the entire hiring process includes various tasks, such as creating and circulating job descriptions, various rounds of interviews, assessment tests and background checks, and selecting the best-suited candidate. Therefore, this entire process requires a lot of time and resources from CPA firms.

Shortage of Qualified Candidates

As mentioned above, the accounting hiring market is facing a drought of skilled professionals in the USA. Due to this, the demand for skilled professionals has increased. This increases CPA firms hiring challenges and difficulty in finding the right candidates with the qualifications and experience.

Talent Gap

We know that many of the current professionals are on the verge of retiring, creating an accounting talent gap for CPA firms. In addition to that, a very few are opting for this industry, and those who do opt-in are not skilled, which also creates a talent gap, leaving CPA firms to struggle to find candidates with requisite skills.

Turnover Rate

Based on our research, many surveys show a significant turnover of employees at CPA firms. This has significantly negatively impacted the stability and productivity of CPA firms. This led to increased recruitment costs and compromised work, which in turn decreased client satisfaction.

2. How CPA Firms Can Overcome Hiring Challenges 

It is crucial for CPA firms to address and overcome hiring challenges to achieve efficiency and productivity in overall operations.

Here’s a list of actions that CPA firms can take to overcome hiring challenges:

Offer Competitive Salaries

As the hiring market is facing a shortage of skilled professionals, it is necessary for CPA firms to offer competitive salaries and benefits that would attract candidates to their firms. This can help firms to deal with CPA firms hiring challenges.

Conduct Proactive Selection

As the accounting hiring market is very competitive, every CPA firm is proactively looking for the right candidates who will help them increase their overall productivity. Therefore, CPA firms that are looking to hire new professionals need to take a proactive approach to recruitment so that they don’t miss out on talent.

Invest in Recruiting

It is important for firms to recruit professionals who can work for them. For this purpose, they can choose to invest in the recruitment process by outsourcing their recruitment process to third parties. This helps them to do away with the headache of the recruitment process and achieve efficiency.

Reduce Employee Turnover

Firms who are better at maintaining the trust and confidence of their employees have less problem with employee turnover. Therefore, CPA firms should focus on reasons associated with employee turnover and take action on that.

Outsource Services

It is one of the best ways to deal with hiring challenges. By opting for outsourced accounting services, CPA firms access experienced professionals and also reduce the overall cost that they put into hiring the best candidates.

3. How CPA Firms Can Ensure Hiring Quality Resources

It is of utmost importance that when hiring new employees, they are qualified and experienced in providing services. For this purpose, CPA firms should ensure the following points when hiring new employees:

Assessment Test

For hiring quality resources, CPA firms should, before selecting and choosing the candidates, conduct an assessment test for every candidate to assess their technical knowledge as well as analytical skills.

Employ Recruitment Agencies

It is a headache to find the best-suited candidates for your firm. Thus, CPA firms can get assistance from recruiting agencies and networks to undertake the recruitment process for their firms. These firms specialise in recruiting and hiring.

Outsource Services

To avoid hiring challenges and get skilled professionals to undertake accounting and financial services, CPA firms can outsource these services to companies that specialised.

4. Is Outsourcing the Right Alternative to Hiring for CPA Firms?

To effectively address recruitment hiring challenges as well as the shortage of skilled accounting professionals, CPA firms can opt for outsourcing solutions that effectively deal with and solve accounting talent shortages and associated challenges. Further, it was observed by the American Institute of CPAs that around 77% of accounting firms in the USA have outsourced at least one service.

By leveraging outsourcing, firms can achieve efficiency in their tasks. Here’s a list of a few advantages that CPA firms can get by opting to outsource:

Access Experienced and Qualified Professionals

By outsourcing financial and accounting services, CPA firms can access experienced and qualified professionals who have experience and in-depth knowledge of accounting, tax and financial services requirements. Further, they specialise in these fields and provide tailored services to meet the needs and requirements of the clients.

Facilitate Cost-Efficient Solutions

Choosing outsourcing instead of establishing an in-house department for accounting and financial services helps CPA firms reduce their overall costs by saving on recruitment, training, and costs associated with hiring additional staff.

Help Manage Fluctuating Demand

As the accounting landscape is dynamic and keeps changing, it is difficult for CPA firms to hire skilled accountants. Outsourcing helps CPA firms to manage fluctuating market demand for professionals.

Increase Productivity

Outsourcing helps CPA firms to avoid unnecessary delays due to the hiring process and focus on their operations. This, in fact, increases the overall productivity.

Overcome Challenges by Talent Shortage 

As the accounting landscape is facing a high shortage of skilled professionals, outsourcing acts as a bridge for CPA firms to access experienced and skilled professionals and overcome challenges imposed by the talent shortage.

Reduce Recruitment Time

Recruitment processes are time-intensive, which take up a lot of a firm’s time, from creating a job description to hiring staff. With outsourcing, CPA firms save recruitment time and also achieve efficiency in outputs.

5. Choosing the Right Outsourcing Service Providers

When opting to outsource services, CPA firms need to be very careful about how and whom they select to be their outsourcing service providers. While selecting the right outsourcing service providers, CPA firms need to consider a few things, such as:

Years of Experience

When choosing outsourcing service providers, CPA firms should ensure that service providers have extensive experience in providing accounting and financial services. CPA firms can benefit from such experience and achieve efficiency.

Proven Track of Record

Selected outsourcing service providers must have a proven track record of successfully serving and guiding numerous CPA firms with the best accounting and financial services, ensuring and delivering excellence and efficiency.

Dedicated Team of Experts

Outsourcing service providers should consist of a dedicated team of seasoned experts with in-depth knowledge of accounting and financial principles and processes that help CPA firms ensure a smooth and seamless process.

Established Client Base

CPA firms should ensure that outsourcing service providers have built strong connections and client bases within the accounting landscape. This shows their ability to provide enhanced outsourcing services. Thus, CPA firms that are willing to outsource their accounting and financial services should see that outsourcing service providers have established client bases that show their market stability and profitability.

Conclusion 

Thus, CPA firms need to be very attentive when hiring in order to address and overcome any challenges that come across. As a strategic decision for overcoming challenges, CPA firms should outsource their accounting and financial services. These outsourced services should offer effective services and aim to save time for CPA firms, so they can achieve growth in their business exponentially.

We at Infinity Globus provide effective outsourced taxation and accounting services to CPAs and accounting firms based in the USA. Our team has over two decades of experience in outsourced accounting & tax preparation services and ensures greater transparency with control to keep an eye on your business. We are here to take care of any concerns that might arise related to our deliverables.

Frequently Asked Questions 

Why should CPA firms opt for outsourcing?

CPA firms should opt for outsourcing solutions as they have expertise and can help in providing efficient accounting and financial services. Further, by outsourcing, CPA firms can effectively deal with and solve accounting talent shortages and associated challenges. Thus, by leveraging outsourcing, firms can achieve efficiency in their tasks, access experienced and qualified professionals, facilitate cost efficiency, and easily overcome challenges imposed by talent shortage.