Public accounting firms don’t need to raise salaries to retain staff, says a guy who obviously never worked in public accounting

In the 12 years since this website was founded, we have heard many complaints from accounting students and public accountants starting their careers. MUCH. Many things have changed since 2009, but one thing has remained constant all these years and that is the overwhelming feeling that CPAs are paid very little for the work involved, which has always been and probably always will be the number one complaint. that we hear. .

It is something that we have discussed when reflecting on the problem of the diversity of the profession, for example. When top-tier business students are thinking about their career paths, accounting is often at the bottom of the list. Firms can talk all they want about “prestige,” but really the only people who care about that are the firms themselves because, let’s be honest, “I work for PwC” doesn’t impress anyone at the bar. Accounting firms cannot (or do not want to) compete with investment banks, and when they try it turns out to be embarrassingly short. So why on earth would various candidates gravitate towards accounting for all things? Well, as we can deduce from the weak attempts of the profession to attract these candidates and the subsequent comments on why no one wants to be an accountant, it is not so.

Across America people from all industries quit their jobs. And why not? Over the past 18 months, we’ve all learned that life is too short to slave in a job you hate, and certainly too short to do so for offensively small pay. We’re seeing it in public accounting as teams are downsized by more and more people saying “F you I’m out,” which means groups that are already in short supply deliberately have to spread the work even more to make up for the shortage. It’s one thing when the company is purposely short on money, and quite another when they are bleeding staff because people are just walking away.

TO Accounting magazine This week’s article addressed exactly this, advising companies on how to retain staff in these uncertain times. Unfortunately, at least one person they got a date from doesn’t understand how this works:

But employers should also keep in mind that turnover is also due to dissatisfaction. While in many sectors, such as entertainment and hospitality, employees leave their jobs in search of higher wages, in other areas, such as accounting, they have different motivations for leaving, said Joe Brusuelas, chief economist at RSM US LLP.

“The change I am seeing is not related to prices. It is not tied to compensation. It’s more about employee satisfaction, viability and interest, ”said Austin, Texas-based Brusuelas.

Yes, accountants are paid more than service personnel at a crab house in Florida. We can all agree on that. That doesn’t mean they get paid well.

The guy who coined the term “Great resignation” Sadly, he signed on to this idea that accountants don’t give up their top-tier companies for money, which means companies will keep scratching their heads in utter confusion about why people aren’t staying:

It is difficult to say how much this phenomenon will affect the accounting profession. There is still no good data to show how different industries are being affected, said Anthony Klotz, Ph.D., professor of management at Texas A&M University in College Station.

However, anecdotally, turnover appears to be high in white-collar professions, Klotz said. “Based on conversations I’ve had with workers and organizational leaders over the past few months, the backlog of resignations, burnout, epiphanies, and remote work” are causing employees to leave their jobs “in all industries, including career fields. “, said. said.

Okay, he has the idea. Burnout especially. Let’s keep reading:

Klotz noted that “generally speaking, some employees only stay at their jobs because they can’t afford to leave.” That’s not true for most accountants, who earn good salaries and therefore have more freedom when it comes to making career changes, he said.

Bruh. You lost me.

You’ll notice the exodus of the big 4 is so bad KPMG UK pointed to staff turnover as a factor in why their audits are so bad. So that it is it is happening and we know because we have eyes that it is happening.

Here is the problem. It’s not strictly money that drives staff away. It is that they do not feel adequately compensated for their work and for the expectation that they will make such work their life. Many people are perfectly happy to work for less money if they are happy in their work, but public accounting does not offer either option for most people. Here it is a Reddit post I came across the other day that sums it up:

College graduates listen up, this is why the public sucks:

They put you on a commitment and you have a specific amount of billable hours that you have to meet (say 55 per week) and then the job takes you 65. You do all this work and you eat that 10 hour difference and then the manager complains that it’s taking too long and “we have to be under budget for this client.” HOWEVER, partners only care how many billable hours you can work, so they just want you to work as long as possible. So kids, you are caught between a manager who doesn’t want you to work long hours but to get the job done correctly and quickly, and then a partner who complains that they are not billing enough. You can’t make everyone happy.

Now you might say, “Well, I’m a great performer and I get my job done correctly and quickly under budget. There are no problems! Right? “WRONG. You, my precious little partner tracking employee, will get even more work so you can bill more. Congratulations! You are a high performing employee and here is your reward! A 5% difference in the increase (after tax equivalent to about 3k compared to Johnny next door who is average and goes to sleep 3 hours earlier than you every day. Are those 3 hours 5-6 days a week worth that pay? from 3k? You decide. Either way, they make you work to death and then make taking time off the world’s biggest hassle. Personally, in my office we couldn’t take off peak season (as usual, nbd) but then they would add blackout periods mid-summer and other times, so you can only really take off about 5 months out of the year. That’s fun!

I live with 4 other great consultants and trust me kids, we in auditing work MUCH harder than they do for less money. It’s a prank. Public accounting is not the right way to go outside of school. They take advantage of desperate and foolish college graduates and convince them that it is there or that they are worth nothing. To all my friends from the big public schools, don’t you ever wonder why half of your teachers are ex-4 great managers? It is because they realized that public accounting works to the death with people and they needed to get out, that they chose an academy that has a decent salary and a good balance in life. Their only job is to convince you to go back to the Big 4 and to public accounting because those same companies sponsor literally half of the accounting programs at the nation’s universities. If you want to go to the big 4, opt for consulting because in my personal experience (YMMV of course) their lives are much easier and they get paid more.

Does it make sense now? Oh what am I talking about, obviously this all makes sense to you, you are the ones living it. And hopefully the ones who are reviewing your resume. There’s never been a better time to tell companies to put your ping pong tables where the sun doesn’t shine and head to those greener pastures you’ve been dreaming of since the day you signed your offer letter. I’m willing to bet that 10 years from now the salaries won’t be much better and they will still be sitting around talking about how Gen XYZ wants satisfaction and growth opportunities and eco-friendly straws in the cafeteria instead of bonuses. Go ahead, receive adequate compensation for your time, stop.

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