Accounting firms are likely to face a talent exodus and an inability to adequately serve clients if sufficient resources are not allocated to upskilling, market participants say.
According to David Whitson-Black, head of talent development at SME advisory firm Azets, the unpredictable nature of the professional services industry means that development programs must be both comprehensive and bespoke.
“In accounting, things change. Technology changes, regulation and compliance changes and you have to be able to upskill everyone with all of that in mind,” he says.
“The landscape is changing and what clients need is changing. If you don’t invest the essential skills that go along with that, you’re not going to be able to give your clients what they need, and you’re not going to be able to grow the business.”
Whitson-Black warns of the retention risk posed by a lack of upskilling opportunities, arguing that people have become more cognisant of their career prospects during the pandemic, and that firms will sacrifice “great skills, knowledge and behaviors” if they neglect development.
Research published by Go1 in July showed that accountants are leaving the profession in record numbers, with nearly half (45%) having left a role due to a lack of training opportunities.
In addition, more than a third (35%) agree that there aren’t enough upskilling opportunities provided to further their career.
“If you start doing that in the accountancy world, it begins to impact the business,” says Whitson-Black.
“If you want to grow as a business, you need to invest in your people because it’s your people that will enable that to happen.”
Thomson Reuters Institute’s annual State of the Corporate Tax Department report paints a similar picture, with more than half (55%) of respondents stating that finding time for professional improvement was their primary challenge followed by lack of upskilling (21%).
Ed O’Connell, UK managing director of professional services at recruitment specialist Search, argues that the exodus of talent in the accounting industry is unsurprising.
“Pent up demand from the pandemic has meant that a lot of organizations are racing to grow their businesses and consequently, there are some really exciting opportunities in the market that are offering all aspects of a role that candidates are looking for.”
The nature of many accounting roles have fundamentally changed, he says, enabling candidates to pursue more varied and strategically-driven opportunities.
“Many candidates are looking for a role where they have the opportunity to drive a business forward,” he adds. “Traditional accounting roles have all but gone, and so it’s important that a role is intertwined with the business to give that spread of influence and decision making.”
Azets’ Whitson-Black agrees, noting that the continual evolution of technology is increasingly enabling accounting professionals to pursue other opportunities.
“We’ve all had to adapt to technology during this period, which has meant that people’s roles have changed in some cases, and they’re then using those skills to find better opportunities.
“But not having the right training and support to develop people – that’s going to make people leave.”
Firms must take action
Whitson-Black stresses the importance of talent development for Azets, which recently acquired four smaller firms in the space of six months.
He argues that inorganic growth necessitates a coherent and consistent skills development regime to ensure the smooth integration of new practices and people, so that “everyone gets the same opportunities to grow”.
“All of the acquisitions we bring in, they come in under the Azets banner, and it’s one Azets,” he says.
“Even though they might have all been small, local businesses that looked after a certain population within that geographic reach, we’ve kept the regional approach and the essence of what that business was.”
Mid-market firms are particularly vulnerable to talent retention challenges, he notes, lamenting the widening skills gap in the professional services sector.
New research by Search, for instance, indicates a skills gap of 22% in the accounting industry. Similarly, the Go1 study estimates that the overall UK skills gap will rise to four million in the next two years..
The mounting demand for these capabilities means that larger firms are more likely to poach talent from below, which intensifies the risk of smaller firms neglecting career development, according to Whiston-Black.
“If you don’t offer opportunities to grow and build a career now, you’re going to lose talent to the bigger firms that can afford to invest,” he says.