Amid a shallowing pool of emerging talent and a workforce nearing retirement age, finding qualified individuals to fill open accounting and finance roles has been an intensifying challenge for insurers. Roughly 340,000 accountants and auditors in the United States have left their jobs in the past five years, which equates to a decline of 17%. Perhaps not surprisingly, our Q1 2024 Insurance Labor Market Study saw recruiting difficulty for accounting positions reach its highest level in the study’s 15-year history.
Current State of Accounting Talent
The U.S. Bureau of Labor Statistics projects 4% growth within the accounting and auditing sector by 2032, representing the addition of 67,400 new jobs – slightly higher than the average predicted growth rate of 3% for all occupations. However, 76% of U.S. CFOs say they are facing a significant talent shortage within their finance and accounting teams. This is further compounded by an aging workforce; according to the BLS, 28% of accountants and auditors are over the age of 55, with a median age of 44.9. It’s estimated that almost 75% of Certified Public Accountants met the retirement age in 2020.
Additionally, the talent pipeline continues to decrease, with fewer students pursuing accounting degrees, amid increasing costs and education commitments. Following the pandemic, overall undergraduate enrollment had a two-year decline of 9.4%, the largest drop in 50 years. Within the accounting major, the number of students completing bachelor’s degrees fell 7.8% during the 2021-2022 school year. First-time candidates sitting for the CPA exam has also decreased, dropping by 33% from 2016-2021.
Along with the decline in overall college enrollment and accounting majors, a variety of other factors are potentially deterring students from the field. These include the perception of accounting as “boring,” lower compensation compared to other fields, anticipated long hours and a lack of diversity. Furthermore, those aiming to earn their CPA designation face an additional 150-hour barrier to entry.
The youngest members of the workforce are also changing jobs more frequently than their predecessors, exploring different careers and companies. In fact, 83% of Generation Z workers identify as job hoppers, with just 13% saying they intend to stay with their employer for more than four years. However, the youngest cohort in the workforce is not alone. More than half of finance professionals are considering making a move in 2024.
What Insurers Can Do
In response to a diminishing accounting and finance talent pool, it is important to prioritize attracting new talent to the field, while also providing ongoing professional development and reskilling opportunities to your current staff. As you revisit your recruitment and development strategies, be mindful of individuals’ shifting expectations and how you can best promote how a career in accounting can meet their long-term professional goals.
Insurers with generous work-at-home policies and a demonstrated commitment to work-life balance will appeal to a broader talent pool across all professional levels. As you engage emerging talent, showcase your company’s unique corporate values and benefits, including your commitment to diversity, equity and inclusion; sustainability efforts; and social responsibility initiatives. Focus on how your accounting department is influencing business decisions, being innovative in its use of technology, and contributing to the organization’s success. Leverage platforms such as the Insurance Careers Movement to connect with young professionals and highlight your company’s employer brand, as well as the exciting opportunities available within the industry.
To ensure a loyal and engaged workforce, it’s important to support your team’s career ambitions and provide a clear vision of their future within your organization. Sixty-three percent of finance and accounting professionals exploring other opportunities cite promotion and career advancement as their main motivators. Take the time to understand the goals of each team member and develop individualized professional development plans that align with their aspirations. Clearly communicating the available career paths and emphasizing how new responsibilities are enhancing their skill sets ensure your employees feel heard and supported. Moreover, investing in upskilling and reskilling initiatives fosters a culture of continuous learning and enables staff to stay relevant in a rapidly changing industry. Promoting internal career mobility not only cultivates employee loyalty but also empowers you to leverage existing talent to effectively address skills gaps.
Filling the Immediate Talent Gaps
With accounting and finance positions becoming increasingly challenging to fill, many insurers are turning to contract interim experts to address their more immediate needs. In critical accounting roles, a deep understanding of the intricacies of the insurance business can be invaluable. Additionally, leveraging the expertise of a staffing firm, particularly one with a focus on the insurance industry, provides access to a bench of highly-skilled, insurance-knowledgeable professionals. This ranges from fractional executives capable of bridging the gap until a direct hire is made to accounting and finance experts suited for special projects and short-term assignments. Moreover, many organizations are exploring the strategy of “lifting and shifting” talent and enlisting external support to supplement internal resources. This allows the latter to focus on other essential initiatives.
Amid the finance and accounting talent shortage, adopting a fresh multi-prong approach is essential for maintaining operational continuity and cultivating a workforce equipped to meet evolving demands. Attracting young professionals and investing in continuous employee development cultivates a relevant and engaged team, while leveraging interim experts can provide immediate relief to pressing staffing needs.