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October 1, 2023

Accounting Firms Need More Career Options If They Want to Retain Talent

The culture in most public accounting firms shape us to aspire to partner level. There may as well be shinin’ disco lights spelling out “PARTNER” plastered above our dismal hotel cube farms.

The culture in most public accounting firms shape us to aspire to partner level. There may as well be shinin’ disco lights spelling out "PARTNER" plastered above our dismal hotel cube farms. 

Even Caleb has admitted it:

I certainly had my own partner aspirations for a brief point in time… For me, my attitude changed when I observed a few partners, saw what their workload and lives were like and thought, JESUS H. CHRIST, BEING A PARTNER SUCKS.  

With partner being the only laudable end goal, no wonder the big accounting firms have become essentially an accounting industry training ground. Firms pay to train us, and then we jump ship after a few years if that shinin’ disco light partner standard does not jibe with our long-term career aspirations. Even AICPA President, CEO and ballroom dancing champion Barry Mealncon knows it:

Firms need to realize that they cannot retain talent unless young accountants can see a future with the firm. And if public accounting culture says “making partner” is the Holy Grail of the accounting profession, then it excludes the 98% of us who will never make it to that level. That’s right. According to the AICPA, only 2% of accountants entering CPA firms will make it to partner.

Studies show that we Millennials, who make up a third of the current workforce, want jobs we can stick with long-term. It’s a misnomer that we job hop more than our predecessors -– at least according to an October 2014 White House publication. That publication claims that “contrary to popular perceptions, Millennials actually stay with their employers longer than Generation X workers did at the same ages.” The study admits that this could be partly due to the recession, which stopped a lot of us from jumping ship for fear of not being able to find another job. 

For public accountants, this means an industry job could be more suitable as a viable long-term career option. As a long-term career option, the shinin’ disco light partner standard actually only works for two types of CPAs:

a) Those who want to be partner.
b) Those who THINK they want to be partner.
Ultimately, it will only work for 2% of CPAs and currently, becoming a partner requires long hours, networking skills, rainmaking skills, some knowledge, teambuilding skills, and some luck. 
NOT ALL OF US WANT THAT OR ARE CAPABLE OF THAT. Public accountants jump ship for a multitude of reasons: 1) Something better comes along; 2) They want their life back; 3) SOMETHING BETTER COMES ALONG; 4) They realize that making partner –- the Holy Grail of public accounting — SUCKS.
Caleb rightly points out that, “The [public accounting] culture… has evolved to accept attrition as part of the formula… In fact… convincing the talented professionals to stay is part of the culture.”
Of course the firm wants to retain its best and brightest, but the pyramid-shaped hierarchy of the public accounting firm precludes firms from always doing so.
According to 2013 AccountingWeb article that studied firms’ employee retention, “firms are facing attrition of senior/manager level staff ranging from 10 percent to 35 percent each year.” 
As for recruiters? They design their recruiting pipelines because firmsknow it’s a matter of time before their hiring class is whittled down to 10% of its original size.” 

The shinin’ disco light partner standard threatens firms’ ability to retain the top talent they worked so hard to recruit, which hurts both the employee and the firm. Those peel and stick Grant Thornton tattoos aren’t free, ya know.

Surely retaining a competent senior manager would be more cost effective for a service-based business like public accounting than spending years and hundreds of thousands of dollars to recruit and train a replacement. Maybe with the cost savings, the firms could eventually increase salaries to help retain their talent.
Firms need to create a culture that makes public accounting a viable long-term career option –- especially for the 98% of us who will never make it to the top of that partner pyramid. While I understand that *someone* has to own the firm and sign the audit report, our culture falsely labels “partner” as the Holy Grail of the accounting profession.
This leads to turnover, which leads to high cost, which leads to lower salaries, which leads to more turnover. If we made more room for director positions and technical specialists and had people aspire to be them, too –- then those CPAs who genuinely enjoy the work (LOL) but don’t necessarily want to sell business or own a part of the firm, could envision a long-term public accounting career, too.
The 98% of public accountants who won’t make it to partner could benefit from a culture that supports their long-term career growth within the same company. Young public accountants will start sticking around when the “only 2% of you will ever actually make it to partner (which is the only career aspiration that even matters)” attitude starts to change. 

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