The Indicator from Planet Money: What happens when there aren't enough CPAs?
A MARTINEZ, HOST:
Waiters, lifeguards, airline pilots, all professions hurting for workers - also, certified public accountants. CPAs earn a special license that gives them a kind of accounting superpower, like being able to audit publicly traded companies. Wailin Wong and Adrian Ma from our daily economics podcast The Indicator look at the CPA crunch and what the industry is doing about it.
ADRIAN MA, BYLINE: Believe it or not, there's actually a news site for millennial and Gen Z public accountants. It's called Going Concern. And for years, it has been banging the drum on the CPA labor shortage. Adrian Gonzalez is managing editor there.
ADRIENNE GONZALEZ: It's almost like there was a accounting rapture, and accountants just kind of disappeared overnight.
WAILIN WONG, BYLINE: Adrienne says at first it seemed like that misery was limited to what's known as the Big Four accounting firms - Deloitte, Ernst and Young, KPMG and PwC. But now all kinds of businesses are feeling the pain.
MA: Adrienne has been hearing from smaller accounting firms, too, that they have had to turn away clients or raise prices. And all this has had an impact on small and medium businesses that rely on those accountants to, you know, help them with tax filings and advising them on accounting rules.
WONG: And when it comes to the Big Four firms, the ones that do the audits for a lot of big public corporations - you know, making sure all their financial reporting is on the up and up - the CPA shortage could compromise the quality of these complex audits.
MA: And you know who really cares about the integrity of these audits? The Securities and Exchange Commission. They regulate public companies, so they take the work of CPAs very seriously. In fact, a few weeks ago, the SEC hit Ernst and Young, one of the Big Four accounting firms, with a $100 million fine. And that's because the SEC said accountants at the firm cheated on the exams they needed to maintain their licenses.
WONG: Now, maintaining those licenses, along with, you know, grueling hours, it gets at some of the reasons why college students may be shying away from accounting careers.
KRISTIN GAYOSO: There were days where I would start at 7, 8 a.m. And I would work until 3 a.m.
WONG: Kristin Gayoso is a CPA who started her career at a Big Four firm.
GAYOSO: The scary thing is, when you work in public accounting, if you take your salary and divide it by the hours that you're working, a lot of times you're making below minimum wage.
MA: Of course, there are a lot of jobs in the finance industry that demand long hours from junior employees. But people who work in accounting, they say that their starting salaries are often lower than those other jobs. And the salaries have been kind of stagnant for years.
WONG: The Big Four firms are responding to the conversation around compensation and burnout. KPMG, for example, announced a $160 million investment in salary increases. PwC, it gave its entire firm 5% raises this year and expanded parental leave and access to mental health services.
MA: The companies are also trying to, like, poach future accountants from other majors like computer science and data analytics. Adrienne Gonzalez of Going Concern, she says that could help modernize the profession in some exciting ways.
GONZALEZ: Where the talent shortage will not be as critical because the technology is starting to kind of pick up the slack and all that.
WONG: And that technology she's talking about, it's automating the most tedious parts of the job. All that administrative paper pushing, that can now be done with software, which means CPAs could be freed up for more creative problem-solving work, you know, the fun stuff.
MA: Adrian Ma.
WONG: Wailin Wong, NPR News.
(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.