Many sources are reporting that the Graduating Class of 2025 is confronting an uncertain employment outlook in the public accounting sector. Some sources are noting, for instance, that firms are expanding their use of AI to complete tasks that were previously assigned to entry level staff accountants.
There are other explanatory factors, though, that may be contributing to the challenging nature of the current employment outlook. One such factor may be the continuing growth of private capital investments in public accounting firms. Many of these firms are adopting alternative (dual) practice structures, with one business entity focusing on traditional attestation (audit) work, and the other focusing on newer and more profitable advisory (consulting) work. The bulk of the private capital is often invested in the latter entity.
That may create a potential misalignment between the firms and their newly hired staff accountants. On the one hand, staff auditing and tax positions have traditionally served as the basic training positions for recent accounting graduates to enter the profession. But on the other hand, because the new investment capital is focused on consulting activities, these traditional entry points do not necessarily prepare new hires for long term career paths in advisory services.
What approach can address this concern? One solution may involve the development of career paths that initially place recent accounting graduates in attestation and tax positions, and that later rotate the young professionals into advisory positions. This policy would maintain the traditional role of staff audit and tax work as the primary entry point into the profession, while providing a subsequent career path into the growth areas of the sector.
This rotational approach should also prove attractive to young professionals who are inclined to agree with the sentiment that "I only have to prepare a tax return 15 times to know how to do it. I don’t need to do it 15,000 times." Indeed, an acknowledgement of the need for basic training is embedded in this sentiment. Nevertheless, an acknowledgement of the need for a more value-focused long term career path is embedded therein too.
Are there concerns about this approach? Certainly, given that firms would be tasked with the burdensome responsibility of developing such employment programs. Likewise, student applicants who seek career paths in the profession would be expected to develop resumes that contain (both) assurance and advisory service expertise.
Nevertheless, the approach does eliminate the potential misalignment between potential employers and prospective employees. As long as public accounting firms and young professionals can look beyond their short term employment needs, it should be possible to create such long term solutions to these career development challenges.