This article summarizes relevant research published in top academic journals over the past ten years to suggest possible strategies to address this shortage. It aims to provide suggestions for improving workforce retention beyond simply increasing pay. Instead it focuses on proven human resource strategies, such as alternative work arrangements, professional development opportunities, person-organization fit, and mentoring programs.
Alternative Work Arrangements
Alternative Work Arrangements (AWA) exist in a variety of different configurations, and they are here to stay in some shape or form. There are a variety of benefits related to AWAs, such as cost savings in transportation, reduced stress and burnout, and increased employee satisfaction. AWAs can be structured many different ways. For example, AWAs can be traditionally remote work/telecommuting, but they also can involve compressed workweeks, flextime, and flexible scheduling. Because there are a variety of possible alternative work arrangements, CPA firms can tailor their implementation. It may be more feasible to implement some of these suggestions, such as compressed workweeks, earlier in an accountant’s career when there is a greater need for onsite training and development. Whereas remote work/telecommuting may be possible only for more senior accountants.
AWAs are here.
The COVID-19 pandemic had a drastic impact on how work was accomplished and resulted in a rapid increase in telecommuting. The pandemic forced accounting students to learn remotely, and as a result, they have become comfortable with this mode of education. Recent interviews conducted among telecommuters and non-telecommuting colleagues in the public accounting sector reveal that a hybrid-telecommuting model is feasible and productive (P.L. Bagley, D.W. Dalton, C.K. Eller, and N.L. Harp, “Preparing Students for Future Work: Lessons Learned from Telecommuting in Public Accounting,” Journal of Accounting Education, vol. 56, p. 100728, 2021, https://tinyurl.com/mrtvcuuz). This arrangement allows telecommuters to work from home while also coming into the office on a semi-regular basis to ensure essential face-to-face interactions. Other research suggests that more creative staffing, such as flextime or variable staffing, during busy periods could benefit firms and help retain younger professionals by reducing burnout (D.R. Hermanson, R.W, Houston, C.M. Stefaniak, and A.M. Wilkins, “The Work in Large Audit Firms: Current Perceptions and Possible Improvements,” Current Issues in Auditing, vol. 10, no. 2, p. A38-A61, 2016, https://tinyurl.com/2vuxymvu).
Support for AWAs.
Research shows that when an organization supports AWAs, such as telework, it can reduce turnover intentions of auditors and perceived gender discrimination (D.W. Dalton, J.R. Cohen, N.L. Harp, and J.J. McMillan, 2014, “Antecedents and Consequences of Perceived Gender Discrimination in the Audit Profession,” Auditing: A Journal of Practice & Theory, vol. 33, no. 3, pp. 1–32, 2014, https://tinyurl.com/rkfzwkyx). Organizational support can also reduce the belief that AWAs will lead to negative career penalties (D.W. Dalton, J.B. Garrett, N.L. Harp, and G.P. McPhee, 2023, “An Analysis of Organizational Support for Telecommuting in Public Accounting Firms,” Behavioral Research in Accounting, vol. 35, no. 1, pp. 1–20, 2023, https://tinyurl.com/2p9tcfv4). There is also generally support for flexible work arrangements across professional accounting firms regardless of firm size (S. Buchheit, D.W. Dalton, N.L. Harp, and C.W. Hollingsworth, “A Contemporary Analysis of Accounting Professionals’ Work-Life Balance,” Accounting Horizons, vol. 30, no. 1, pp. 41–62, 2021, https://tinyurl.com/bd5vevhp).
Implementation is key.
Prior research fosters the idea that professionals support AWAs in the post-COVID era, but this is not to say that telecommuting is perfect. While younger professionals are accustomed to remote learning and may be able to transition to remote work easier (Bagley et al. 2021), CPA firms will need to closely examine their flexible work arrangement options and implementation processes to ensure organizational support. Research notes that supervisor support for personal/family needs goes a long way to increase perceived support (Dalton et al. 2023).
Professional Training and Development Opportunities
The benefits of training and development opportunities for early-career individuals are imperative for later success. CPA firms should take advantage of providing specific avenues that allow for individuals entering the profession to be more agile with a broader set of skills.
Focus on resiliency. Firms that recognize the importance of resiliency in young auditors and accountants can help mitigate a variety of negative outcomes (K.J. Smith, D.J. Emerson, C.R. Boster, 2020, “Resilience as a Coping Strategy for Reducing Auditor Turnover Intentions,” Accounting Research Journal, vol. 33, no. 3, pp. 483–498, 2020, https://tinyurl.com/2uvarwam). The findings demonstrate that resiliency reduces burnout, departure intentions, turnover intentions, and stress in practicing auditors. One such way this may occur is through the implementation of more training earlier in individuals’ careers, so that this is a regular practice throughout their individual development.
Offer unique training.
Individuals often choose to enter a field or stay in an organization because of growth opportunities (H. Nouri, and R.J. Parker, “Career Growth Opportunities and Employee Turnover Intentions in Public Accounting Firms,” The British Accounting Review, vol. 45, no. 2, pp. 138–148, 2013, https://tinyurl.com/m74m3v2b). Growth opportunities can serve as a pathway that allows individuals to continue to progress in their careers. For example, research in the accounting profession that focuses on more unique training, such as metacognitive skills or one’s thought process (R.D. Plumee, B.A., Rixom, and A.J. Rosman, “Training Auditors to Perform Analytical Procedures Using Metacognitive Skills,” The Accounting Review, vol. 90, no. 1, pp. 351–369, 2015, https://tinyurl.com/4c4uyhye), may help with the recruiting and retaining of professionals in the field.
Recognize the impact of disruptive technology.
The amount of disruptive technology will continue to grow and influence how work is completed. This disruption is acknowledged by the increased focus on technology in the blueprints for the revised CPA Exam (B. Roessner, “2024 CPA Exam Blueprints Released,” Journal of Accountancy. 2023, https://tinyurl.com/635v7xfs). Organizations will need to have individuals who possess skills to adapt to disruptive technologies (C. Zhang, J. Dai, and M.A. Vasarhelyi, “The Impact of Disruptive Technologies on Accounting and Auditing Education: How Should the Profession Adapt?” The CPA Journal, September 2018, https://tinyurl.com/yc3drpuv). This provides an opportunity to offer training and career development in a way that allows accountants’ skillsets to remain current while addressing needs of the organization.
Person-Organization Fit
Individuals want to work in organizations where they feel that there is a congruence between their actions and the organization’s. A stronger focus on attracting individuals that share similar values and goals with the organization during the strategic recruiting process reduces the likelihood of negative outcomes. Research in topics such as person-organization fit, climate, and mentoring can shed light on what CPA firms can do in this area.
Climate and culture influence behavior.
In CPA firms, there can be very strong cultures that guide the behavior of individual auditors. Interestingly, prior research documents the importance of the socialization process which underlies firm culture, and finds that, with each subsequent promotion, professionals face larger socialization challenges (L.M. Andiola, D. Hanes Downey, and K.D. Westermann, 2020, “Examining Climate and Culture in Audit Firms: Insights, Practical Implications, and Future Research Directions,” Auditing: A Journal of Practice & Theory, vol. 39, no. 4, pp. 1–29, 2020, https://tinyurl.com/y6p84j26). When there is a lack of a fit between an organization and an individual’s own personal values at the start, or even as they advance in their career, the person may very well choose to remove themselves from the organization.
Alignment of beliefs.
There is a current shortage of new entrants to the accounting profession, and stiff competition to attract these individuals. Research shows that a bottom-up socialization process, whereby firms adjust to meet the expectations of newcomers, might help with recruiting millennials into accounting firms (S. Durocher, M. Bujaki, and F. Brouard, 2016, “Attracting Millennials: Legitimacy Management and Bottom-Up Socialization Processes Within Accounting Firms,” Critical Perspectives on Accounting, vol. 39, pp. 1–24. 2016, https://tinyurl.com/mcakzjad). Millennials are more likely to choose work environments that align with their values and beliefs. Individuals entering into the workforce who are members of Generation Z are likely to have this same expectation, so it may be crucial for CPA firms to take this under consideration for younger members of the workforce.
Promote value congruence with mentoring.
There is more evidence that individuals want to work for firms that hold similar values and beliefs as their own. Research shows that when a mentor communicates the organization’s values and helps the mentee explore and refine their own values, there tends to be stronger value alignment, which can reduce turnover (T.J. Fogarty, A. Reinstein, R.A. Heath, and D.H. Sinason, “Why Mentoring Doesn’t Always Reduce Turnover: The Intervening Roles of Value Congruence, Organizational Knowledge and Supervisory Satisfaction,” Advances in Accounting, vol. 38, pp. 63–74, 2017, https://tinyurl.com/ypw56dzr). CPA firms should consider training or educating mentors on the importance of this role in the mentorship process.
Mentoring Programs
CPA firms could focus on providing more mentoring opportunities to individuals earlier in their careers in order to help them navigate difficulties early in their career, something that research has shown to have positive implications.
Multiple coaches matter. By providing employees with opportunities to work with multiple supervisors, positive coaching experiences can mitigate a negative coaching experience (L.M. Andiola, J.C. Bedard, and J. Kremin, “Coaching Quality and Subordinate Work Attitudes in Multiple Supervisor Audit Context,” Accounting Horizons, vol. 35, no. 3, pp.23–46, 2021, https://tinyurl.com/4ctfyv42). High quality coaches can also serve as mentors, which can help decrease turnover.
Peer mentoring is positive when paired with strong leadership.
Positive peer advice is more likely to be followed when the opinion confirms one’s initial thoughts (E.E. Griffith, K.Kadous, and C.A. Proell, “Friends in Low Places: How Peer Advice and Expected Leadership Feedback Affect Staff Auditors’ Willingness to Speak Up,” Accounting, Organizations and Society, vol. 87, p. 101-153, 2020, https://tinyurl.com/d5hp3meb). Making sure that poor peer advice does not negatively impact work outcomes is a balancing act. Fortunately, research shows that quality supervisor feedback mitigates negative peer advice. In addition, peer guidance may improve an individual’s confidence when the right decision is confirmed by a peer mentor.
External mentoring can help.
External mentors can help to lower turnover by minimizing the impact of poor feedback environments on turnover and commitment (D.W. Dalton, A.B. Davis, and R.E. Viator, “The Joint Effect of Unfavorable Supervisory Feedback Environments and External Mentoring on Job Attitudes and Job Outcomes in the Public Accounting Profession,” Behavioral Research in Accounting, vol. 27 no. 2, pp. 53–76, 2015, https://tinyurl.com/3s6t6y69). This provides accountants with an advisor outside of a direct supervisor to provide guidance as they proceed through their careers. CPA firms can encourage young employees to network with outside accounting professionals to gain trusted external mentors.
Mentoring serves different roles.
There are different ways that mentoring can influence accountants and impact whether they seek to leave the organization (Fogarty et al. 2017). Different mentoring aspects, such as career development, role modeling, and career development, have different impacts on turnover intentions. Mentoring therefore should be tailored to the specific needs of the individual being mentored.
Creating a Workplace that Can Attract and Retain Talent
Firms aim to create an attractive workplace. The expectation is not that a firm should implement every single suggestion listed above, nor is this an exhaustive list of options. Nevertheless, this article presents some opportunities that may alleviate the shortage of accountants as these strategies deal with some of the key issues that are causing young professionals to turn away from the field. Based on academic research, reviewing AWAs, professional development opportunities, person-organization fit, and mentoring programs may help CPA firms attract and retain top talent.
