The Great Resignation: Accountancy Firms Face Urgent Labour Challenges -How industry leaders can attract and retain workers from a shrinking talent pool
Published 4 months ago by Medet Ali
Job loyalty, once considered a desirable trait for professionals regardless of industry, could be a thing of the past, as shown by the record number of job vacancies in the UK at the end of 2021 – 1,247,000 to be exact, according to the Office of National Statistics.
Employees are moving on to new positions more frequently, resulting in huge blows to industries across the country. In a Randstad UK survey of over 6,000 adults, almost 69% of employees said they felt confident leaving their current employer in the next few months. This self-assurance comes from a broad-scale re-evaluation of what workers want for their families and from their employers.
Despite Randstad UK’s assessment of accountancy – its workers are among the least confident about leaving their jobs, along with human resources, legal, and call centres (59%) – the Great Resignation has hit the industry hard.
Employees feel the grass is greener elsewhere
These eye-opening statistics beg the question – why are employees leaving their jobs?
Transitions to entrepreneurship or new careers
In 2021, the UK saw new businesses hit a record high. 319,000 were created, most of which were e-retailers or delivery firms. Clearly, a COVID-induced desire for reinvention motivated thousands of people to try their hand at entrepreneurship. What isn’t clear is what this means for the long term – many of these businesses may fail over the next few years as the pandemic reaches new and less restrictive stages; others could become new household names. What is clear is the workforce’s yearning for something new.
For those workers who still prefer a corporate safety net, they’re tapping into their lesser-used skill sets to make complete career changes. Industries like IT and software have seen hiring surges, potentially due to workers’ increased ability to work remotely.
Preferences for work from home and hybrid schedules
The last two years have given many workers a taste of flexible schedules, remote work, and work-life balance. With a surge in demand and a low supply of workers, it’s a job seeker’s market, in which they’re making their preferences known, forcing businesses to adapt to beat the competition.
Higher expectations of employers
In addition to flexible schedules, other aspects of employee engagement are driving workers to new companies. In light of the social justice movement that took off during the pandemic, UK employee comments on diversity, equity, and inclusion (DEI) increased 31% in 2020, touching off a significant and ongoing trend. Additionally, according to a LinkedIn Talent Solutions report, workers’ push for good work-life balance has centred excellent compensation and benefits. Given employees’ current market advantage, they’ve hopped jobs to chase higher pay and more relevant perks.
If an employee works for a company with just ten workers and three of those people leave, what happens to the departed employees’ work? It’s redistributed amongst the remaining employees. A poll conducted by Monster showed that 69% of employees are experiencing symptoms of burnout, even when working from home. While daily commutes no longer suck up time, workers are now in close proximity to their workstations, resulting in higher productivity but also longer hours and increased isolation.
Accountancy faces the Great Resignation
No different than any other industry, accounting is navigating the many issues impacting all companies. But there are industry-specific concerns, too. According to Accountancy Today, approximately three-quarters (74%) of organisations within the accounting industry are feeling the anxiety of the Great Resignation.
In a survey across industries, 74% within the accounting and finance sectors say that skills shortages are affecting their business (compared to 52% of managers working in sales). Lack of qualified candidates and retention troubles only compound their Great Resignation-related staffing woes. When knowledge workers are lost and these highly sought-after skill sets are less common, vacancies are harder to fill with qualified people.
Taking all this into consideration, accountancy firms – like most businesses at this moment – need to take action to remain competitive, attract new employees, and retain top talent. How they do this may vary based on the specific circumstances of the firm, but there are a few general best practices that apply regardless of headcount or specialty.
Consider offering flexible or hybrid schedules
While COVID-19 has forced many firms to hastily embrace remote work, research has suggested that the work-from-home model has many benefits. In fact, 83% of workers say they don’t need an office to be productive. Many accountancy firms agree – in a survey of 179 firms, 78% of them are planning to expand their virtual work policies, stating that more flexibility in work arrangements has increased job satisfaction .
Consider the benefits of offering remote work:
It’s far easier to attract top talent from outside your immediate geographic location When employees are able to balance their work with their personal interests, this increases engagement, which results in greater productivity and profitability for your business. Not only will employees save money by not commuting or commuting less, your business will ultimately save money, too. According to a study conducted by Hitachi Capital UK, 250 SME business owners found a 53% savings in employee food and drink, 48% in employee travel, 45% in cleaning services, and 36% in both catered client meetings and rent and utilities.The downside of course, that it is harder to create and maintain culture. There is also the issues involved in supporting more junior staff.
Create engagement opportunities where employees can build relationships
Although a majority of workers want to continue working from home, 30.9% of remote workers say they struggle with isolation and loneliness, and 62% want their employers to provide better technology to stay connected to their colleagues.
This lack of connection can get dicey for firms attempting to create a sense of loyalty between employee and employer. There is a lot to be said about the value of virtual happy hours, outdoor activities (where social distancing is possible), and more robust communication strategies to keep employees “in the loop”.
One British-Dutch firm had a vision of inspiring its employees by reaffirming the purpose in their work. By asking employees to share their stories of what they do, how it impacted the business and, in some cases, how their work made history, the firm has drastically increased engagement scores on its surveys and alternately, turnover has radically decreased.
Re-evaluate your recognition programs
Beyond Employee of the Month, what is your firm doing to recognize employees? Increased employee satisfaction results in happier customers, who positively affect your bottom line. Employee recognition boosts positive behaviours, sparks creativity and innovation, and builds trust between employee and manager. All of this results in lower turnover rates.
While it doesn’t necessarily pay the bills, a simple “thank you” goes a long way. Employees feed off positive feedback, increasing their discretionary effort in direct proportion to their increased engagement. The best part for your business? Recognition can be free. Just ensure your praise is timely, specific, and genuine.
However, though a verbal “thank you” is often appreciated, our complex human nature might require more in the long run. Other cost-effective ways your business can boost recognition programs include hosting employee celebrations around work anniversaries and life events, periodically offering longer lunches or letting employees leave early the day before a holiday, and sending gift cards to restaurants you know employees will enjoy.
Act on Corporate Social Responsibility (CSR)
What constitutes CSR? This isn’t just about making an annual donation to a firm’s favourite charity (although that’s part of it). Employees who identify as millennial and Gen Z make up a large portion of the workforce and place a high value on purpose and positive social change. This means CSR should include (but not be limited to) sustainability efforts, employee health and well-being initiatives, diversity and inclusion, and improvement of labour conditions.
Some UK firms have introduced mental health awareness training for executives, reduced paper consumption by implementing paperless systems, and developed live webinars for recent graduates to learn more about the accountancy profession. CSR in action helps attract and retain top talent by keeping pride and purpose at the forefront of desired positions.
An alternative perspective
While there’s much talk about the Great Resignation in the UK, many argue it’s only part of the story and that employees leaving jobs to “re-examine their lives” doesn’t paint the full picture. Terms like the “Great Churn” have been used to describe the exit of workers from one job to fill newly created jobs, resulting in what many consider a strong job market. This strong job market has made it viable for workers to seek improved opportunities. Additionally, the pandemic has accelerated job evolution, shrinking down what would normally happen over a decade to just under two years. Whereas blacksmiths had to become auto mechanics in the late 1800s, accountants are having to become innovative cloud users in 2022.
With the average cost of employee turnover at £11,000 per person (based on the average UK salary), improving recruitment and retention strategies has become a primary focus for UK firms. With accountancy a specialized industry, businesses must communicate what they have to offer, whether it’s career progression, learning and development opportunities, or flexible work locations and schedules. This matters greatly – strong competition in the marketplace becomes even more daunting when the perfect candidate goes elsewhere to get exactly what they desire, such as working from home one additional day per week.
Still, the accounting industry has proven its agility. Many firms are moving quickly from compliance to consultancy for clients to minimize fee pressure and manage a shrinking labour pool. A firm’s strong leadership and people strategies also come into play – how do businesses develop a strong culture where employees can be their authentic selves in a virtual environment? Firms that invest their efforts in strong team synergies – and that remain aware of industry trends – are less likely to be affected by the Great Resignation, reducing attrition and attracting top talent.