With the growth of software and technology in the accounting industry, you’d think there’d be a growing number of trained professionals to fill the available positions. But that is not the case.
According to research by the Chartered Institute of Management Accountants (CIMA), over four in five (82%) SME employers identified skills gaps within their organisation in the past 12 months.
This research shows upskilling is given insufficient priority in the U.K., and workers are quite complacent about their skill levels. While this is currently an issue in the accountancy profession, what does the future hold? Is technology able to provide a solution? Let’s find out.
The problem of skills shortages in accounting
The problem of skills shortages in accounting is not a new phenomenon. A Deloitte poll conducted in 2022 found that 82.4% of recruiting managers at public businesses for accounting and finance jobs confess to having trouble with talent retention.
The reasons for this decline are many and varied, but they all stem from one central issue: the accounting profession has failed to adjust its educational requirements to reflect changes in technology and other social trends.
Several significant changes in recent years that affected how accountants work include:
- Increased use of technology
- Increased use of outsourcing and offshoring
- Increased globalisation of business operations
The consequences are that firms are struggling to find people with the right qualifications and experience to fill vacancies, and graduates cannot find work after leaving university.
This problem will only get worse over time because there are fewer accountants entering the profession than ever before. According to the FRC Key Facts and Trends 2022 report, there has been a decline in accounting students in universities all around the U.K. due to other career options being more appealing or simply because they don’t see it as an attractive career choice anymore.
Is technology the solution to the skills shortage?
As technology has become more advanced and more accessible, there has been a shift from human-only tasks to automated processes. This has led to some concern that automation will replace accountants altogether. But the reality is that automation will only make up part of the solution to the skills shortage.
Accountants need to understand how technology can help them carry out their jobs better, but they also need to be aware that these technologies can only replace certain aspects of their work.
Technology such as artificial intelligence (AI) can automate many mundane tasks, freeing up time for accountants to focus on higher-level tasks such as strategic planning or building relationships with clients.
Unfortunately, these new technologies also present challenges that cannot be ignored, as they have the potential to disrupt an accountant’s workflow entirely. Plus, learning to use these technologies can’t be automated – it needs to come from the willingness of the accountant, along with solid learning and development programs.
Technology is poised to improve the accounting industry for everyone involved. It can help relieve some of the stress of the work that accountants need to do, but it will not solve the skills shortage.
Employers still need skilled professionals, and customers will start asking more from their accountants; a hands-on approach, insightful discussions, and guidance.
What’s more, utilising the right technology in the right places can even equip students with the necessary skills to do a better job in solving the industry problem, leaving less work for accountants to do manually.
It is crucial that accountancy firms explore new ways of using technology as an aid. But whilst that’s a good start, they’ll also need to build up their own internal talent and not rely on technology alone.
Join INAA to network with accounting experts worldwide
Want to stay up-to-date with the latest trends and topics for your accounting marketing? The International Association of Independent Accounting firms (INAA) launched 25 years ago to promote international trade.
To make global business personal and to take personal business global, we connect accounting firms that strive to provide quality professional services. Our cooperative association of foreign companies is dedicated to participating in global accounting and sustainability discussions.
Join now to begin forming effective business connections.