A recent report by the Indiana CPA Society (INCPAS) reveals that 52% of accountants expect their firms to reduce headcount by 20% over the next five years.
The study, conducted by CPA Crossings and titled “Transforming Your Firm’s Business Model: Workforce Transformation and Talent Management Strategies,” surveyed 205 full-time professionals across public accounting firms in 31 US states, representing roles from staff accountant to partner.
The report highlights a significant shift in workforce expectations, with most respondents anticipating a reduced need for entry-level employees in the future.
This change is driven by technological advancements and a talent shortage, which are disrupting traditional business models in public accounting.
The conventional pyramid-shaped practice structure, reliant on a large pool of entry-level staff, is becoming unsustainable.
According to the findings, firms will need to prioritise hiring staff with technology and business skills who can start at an experienced level and deliver greater value to clients more quickly.
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By GlobalDataThe traditional pyramid structure, designed for gradual progression, is seen as a barrier to retaining and accelerating talent, as it does not accommodate the pace required to reach experienced staff or manager levels efficiently.
The report suggests that firms must adopt new practice structures to remain competitive. One proposed model is the inverted pentagon structure, which is designed to address ongoing technological advancements and talent shortages while retaining top performers.
This model focuses on accelerating staff to high-value roles and offering compensation beyond traditional partnership tracks.
The study identifies six key areas of Business Model Transformation to guide firms in adapting to these changes, including precision hiring, proactive retention, practical technology implementation, pricing expertise, practice area expansion or focus, and people acceleration.
These insights indicate that accounting firms must rethink their workforce strategies and practice structures, in order to navigate the evolving landscape of the industry.
