Firm of Dreams: If You Build It, They Will Stay

Employee retention has been a bleak topic for some time in the accounting profession. Since 2019, the number of employed accountants in the United States has sharply fallen 17.3% (as of 2023), according to the U.S. Bureau of Labor Statistics. Notably, this decrease is a result of attrition at both ends of the profession: At entry, there are fewer college students choosing to enter the field, and simultaneously, many accountants are choosing to voluntarily exit the field.

Though, despite this long-term and devastating trend, there does appear to be some gleaming hope that certain strategies may be able to reverse this tide. According to Gallup’s State of the Global Workplace 2023 Report, 52% of voluntarily exiting employees say their manager or organization could’ve done something to prevent them from quitting.

Of course, many stakeholders, including the Illinois CPA Society (ICPAS), have gone to great lengths to know exactly what that “something” could be. In its 2023 Insight Special Feature, “Righting Retention,” ICPAS shared research findings to shed light on what’s driving the accounting profession’s perpetually higher-than-average turnover rates. In the report, the top three reasons cited for accounting and finance professionals voluntarily quitting their employers were salary, too many hours/burnout, and lack of work-life balance. Interestingly, workplace culture was cited as the fourth reason for employees exiting—and some experts believe this factor, specifically as it relates to valuing and prioritizing people, could be the key to building a firm where no one wants to leave.

Prioritize People Over Profit

Tammy Daugherty, M.Ed, is the owner of People Matter Consulting Ltd., a Cincinnati-based change management and leadership consulting firm. She emphasizes that accounting firms need to focus on prioritizing people over outcomes.

“In the accounting and finance field, numbers matter—they’re the first focus,” Daugherty observes.

She adds that numbers are what accountants naturally gravitate toward, noting that quantitative measures are more tangible than qualitative measures (i.e., revenue is easier to quantify than happiness). However, Daugherty stresses that a firm’s success is dependent on the well-being of its employees. In her experience, the firms that prioritize their people are the ones that see results.

“When leaders or managers put results first, their people suffer. You can see this by their results, turnover, and loss of traction when trying to implement changes to make their company better and stay competitive,” Daugherty says.

One characteristic deterring people from careers in accounting is the concept that it’s all about the hours and not about the people.

“That’s how the profession has been thinking for so long, and it’s just not sustainable,” explains Randy Crabtree, CPA, co-founder of Tri-Merit Specialty Tax Professionals.

Crabtree wonders if maybe the challenge stems from the industry being so client-focused for so long, and that it forgot to focus on itself.

“As a profession, we don’t have enough people right now. We all have so much work and so many clients, and the personality of an accountant is to want to help everyone and find answers to all the problems,” Crabtree says. “So, we find solutions for our clients, but we forget that the people we work with also need care and support.”

Crabtree suggests that the accounting industry as a whole needs to shift its thinking away from counting hours to instead valuing employees. By doing so, Crabtree believes employees will want to put in those extra hours when needed. “There’s a difference between expecting employees to work on the weekends and creating an environment where employees want to work on the weekends,” he says. “Start by building a personal relationship and showing them that they’re important rather than the work being most important. “When your employee comes into the office in the morning, instead of saying to them, ‘Hey, you know that project you were working on yesterday? I need it today,’ say, ‘Hey, how was your evening?’”

Connect, Engage Employees With the Firm’s Goals

Perhaps because of the emphasis on the quantitative aspects of accounting, accountants find themselves feeling more like cogs and less like people, suggests Loretta Kilday a Chicago-based attorney, who specializes in personal finance, debt, business collections, bankruptcy, and family law. She says this feeling is reinforced when accountants feel a lack of connection to firm objectives.

“Today’s employees are motivated by more than just salaries. They need to grow, learn, and make significant contributions to their organizations,” Kilday explains. “There’s often a lack of effective communication [among accounting and finance firms] that makes workers feel unappreciated or disconnected from the goals and accomplishments of the organization.”

Dennis Shirshikov, head of growth at Awning.com and a professor at the City University of New York, agrees that communication is key to keeping employees engaged with overall firm objectives.

“One common oversight is underestimating the value of transparent communication and feedback loops,” Shirshikov says. “In the labyrinthine structure of accounting and finance firms, it’s easy for employees to feel disconnected from the broader mission and undervalued in their daily contributions.”

The benefits of connecting employees to firm objectives go beyond retention strategies. Shirshikov says that authentically engaged employees exhibit higher productivity, lower turnover rates, and foster a sense of innovation.

“An engaged employee, feeling valued and understood, transforms from a mere cog in the machine to a pivotal force for growth and innovation,” Shirshikov emphasizes. “Engaged employees are the bedrock upon which firms can anticipate market shifts and adapt services to meet evolving client needs.”

The difference, Kilday observes, is that engaged employees don’t feel obligated to do their jobs, they feel ownership and pride in their work, and this translates into overall firm health.

“Truly engaged employees want to do more than just feel good about their jobs, they want to contribute to their companies’ success, which has measurable benefits, such as reduced staff turnover, increased productivity, better customer service and, ultimately, improved financial performance,” Kilday says. “Additionally, firms that have mastered employee engagement often see stronger client relationships and a more resilient brand.”

Invest In Your People

Susan Stutzel, CPA, is a sole practitioner who serves nonprofit clients. Per her own words, she lives, breathes, and loves the accounting profession—and has for more than 20 years. For the first time in her experience, she says there are multiple generations in the workforce at the same time, and each generation has very different needs and expectations. Stutzel says one of the biggest challenges the accounting industry faces is shifting the perception that being a certified public accountant (CPA) is merely a job, not a career.