Extending Outsourcing Contracts Can Alleviate Shortage of CPAs

By Paula Laurenti, Key Accounts Manager at SAPRO.

The U.S. accounting profession is facing a severe shortage of certified accountants. Projections indicate that demand for accountants and auditors will increase by 13% between 2021 and 2031, with an estimated 136,400 job openings between 2021 and 2023. This shortage of qualified professionals has led to a lack of expertise, lower productivity, and increased workload for existing staff.

The Causes of the Shortage

The shortage of certified accountants in the U.S. is due to several factors. The demand for accountants has steadily increased due to business growth and tax regulation complexity, while fewer students pursue accounting as a profession. Despite a 9.10% increase in regional completions from 2010-2021, there was a 12,789 completion decline from 2019-2020 alone. Encouraging more students to pursue accounting careers is necessary to meet the growing demand for skilled professionals in this field.

The baby boomer generation retiring at a rapid pace is leaving a significant gap in the accounting industry, and firms are struggling to replace experienced professionals. Annual Replacement Employment for accountants and auditors in the US was 114,730 between 2020-2021, projected to rise to 129,627 by 2025-2026.

The pandemic has also impacted the accounting industry, with firms cutting back on hiring and training, challenging talent attraction and retention, and exacerbating the shortage of certified accountants. The labor force participation rate in the U.S. has steeply declined, from 63.4% pre-pandemic to 62.1% currently, largely explaining the shortage of skilled accounting professionals.

Addressing the Shortage with Talent Augmentation

The shortage of certified accountants in the U.S. is a significant problem requiring immediate attention. One solution is talent augmentation, outsourcing talent to reinforce the workforce and access expert talent globally. Talent augmentation companies have a vast network of highly skilled professionals for short or long-term projects. They provide the expertise accounting firms need to stay competitive, saving on training costs and reducing the burden on existing staff to focus on core tasks.

Gain a competitive advantage with on-demand talent

Talent augmentation provides accounting firms a competitive edge by accessing a diverse pool of talent, including niche experts, for complex projects. Along with the shortage of certified accountants, firms face budget and time constraints, and the need to stay competitive while maintaining quality services and technology trends.

Extend outsourced talent contracts for business continuity and expand your firm

One solution to these challenges is by extending current outsourced talent contracts. The expert talent has already been deployed on a short-term contract, and by now, knows the various nuances and ways of work each firm has, they can become better integrated with the firm’s culture and can deliver higher quality work. The team has spent time together and extending this develops trust and stronger relationships. Continuous high-quality work is another advantage. Additionally, extensions can help firms create a more diverse workforce by accessing talent from around the world.

The key advantage of extensions is preferential pricing. When a firm enters into a multi-year agreement with a talent provider, they can negotiate better pricing and save significant costs over time. Outsourcing talent can furthermore help firms save money on salaries, benefits, and other costs associated with hiring and training employees, as well as avoid the costs associated with maintaining office space and equipment.

Access to growth markets is another benefit of extensions, as firms gain access to a dedicated facility and talent pool to help them expand into new markets and regions. This can be especially valuable for firms that lack the resources or expertise to do so on their own.

Retain access to skilled global talent through extended outsourced talent contracts

Extensions also offer solutions to attrition and retention concerns in today’s fluid market conditions. Outsourced talent providers have a steady pool of talent sourced globally, so firms can easily replace resignations or poor performers without disrupting their operations. Longer-term deployment reduces volatility and increases flexibility, which helps firms better plan and manage their operations. Firms can scale their workforce up or down as needed. This approach is especially useful for firms that experience seasonal fluctuations in demand or need to staff up for specific projects.

Extensions can recession-proof a business and help firms achieve growth aspirations. Partnering with an extension provider gives access to talent and resources to weather economic downturns, expand services, and compete with larger firms without hiring full-time employees. Talent augmentation companies offer innovative approaches and access to latest technologies, allowing firms to stay updated without incurring research costs.

Leverage talent augmentation to tackle the talent shortage and strategically grow your firm

In conclusion, outsourcing talent and extending contracts with a talent augmentation company is a smart and strategic solution for accounting firms to address the ongoing talent shortage in the U.S. This approach can help firms achieve their growth aspirations while providing high-quality services to their clients.

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Paula Laurenti, Key Accounts Manager at SAPRO. Paula has experience across telecommunications, retail, and finance industries, building and maintaining strong client relationships while driving revenue growth and high customer satisfaction ratings.

SAPRO is a global talent outsourcing firm providing expert professionals in tax, advisory and assurance, aligning optimal resources for sustainable growth. Our seamless workforce solutions meet your needs today to unlock opportunity tomorrow.