Labour pains

Brooke Hepburn-Rogers is thinking of creating her own internship program in competition to the big accounting firms in the hope she may be able to attract staff. The founder and owner of ACT-based Foxton Financial has more than 22 years’ specialist experience within SMSF and accounting and for the past few months she’s been trying everything to recruit including flexible hours, work-from-home, and a high degree of autonomy. But Ms Hepburn-Rogers says accounting staff are very hard to find, let alone keep.

The skills shortage facing all Australian industries is hitting the accounting and finance sector particularly hard.

In the June Seek.com.au report, accounting was one of the only sectors to report an increase in job ads with a rise of four per cent. Most other industries reported a drop either because businesses have given up trying to recruit staff, or they’ve been lucky enough to find some.

It’s not just the smaller accounting firms that are having trouble. The Australian Financial Review Top 100 Accounting Firms survey shows three-quarters face challenges in recruiting and retaining staff, and qualified auditors are especially thin on the ground. As larger firms lift salaries to attract talent, smaller practices must try to recruit new staff and hang on to the employees they have.

“I’m struggling to find people who want to work from home,” Ms Hepburn-Rogers says. “I’ve been looking now for more than a month, on every job recruiting site, on social media, through friends and even asking university students.”

Ms Hepburn-Rogers works from a home office and has won a slew of awards on the strength of it.
“I love working from home, I’m much more productive. I still go out and see clients. I find it odd that people don’t like to work from home,” she says.

“I found it surprising that the feedback I am getting, from the younger generation, is that they want to work in an environment where they have face-to-face contact and I know some would like that mixture of work-from-home and office.”

“I really thought the job I have would have been perfect for mums and dads going back into the workforce, but I wasn’t getting any bites.”
Ms Hepburn-Rogers says when office space does become available, she will move to a more hybrid arrangement.

“I’m not into micro-managing. Some other employers get worried that they wouldn’t know if their staff would be working as much if they did it from home, but I believe if the work is getting done on time, then it’s fine.

“I had someone start work and two days later they got COVID but after they had recovered, they called to tell me they weren’t coming back because they found it too hard to manage their time working from home. Which I understand as it is easier to quickly ask questions in an office environment.”

Ms Hepburn-Rogers is no stranger to the big end of town, having worked for KPMG and other major accounting and auditing operations, and she understands the attraction of larger firms especially for graduates.

“Graduates want to apply for the ‘sexy’ positions at the big accounting firms and the government graduate positions,” she says. “One of the selling points with the big graduate programs is that they are more likely to get a higher role after they finish. But you can also work your way up those positions. I started as a receptionist in a firm and worked my way up and that gave me good fundamental skills.”

And she believes smaller firms can capitalise on those fundamental skills when trying to recruit new staff. “I’m thinking about doing my own version of a graduate program,” she says. “They can start it in their first year of university and do on-the-job training, and that way they get to work in all different areas of accounting.”

“I thought about going into speak with Year 12 students and talking to them about budgeting and taxes as a way to introduce them to the industry and then offering internships. I also want to approach other professional organisations, such as CA ANZ and CPA, to see if we can cross-promote together.”

Nicole Gorton, director at Robert Half recruitment, says the finance and accounting hiring market remains strong as businesses pursue new growth agendas, and the war for talent is becoming increasingly fierce.

“Australia’s economic rebound coupled with digital transformation efforts are driving business expansion agendas with our research finding that over a third of CFOs plan to increase headcount in the next six months,” she says.

“While more jobs are being created, the supply of active accounting jobseekers to fill this demand remains critically low. Skilled candidates are being poached from their employers through generous salaries, title changes, sign-on bonuses and more.”

From her own experience, Ms Gorton says as cost-of-living pressure continue to mount, salary is the key driver behind financial jobseekers’ decision making. “Flexibility also remains key, with businesses that do not offer flexible working arrangements not only struggling to attract talent, but also losing existing employees to competing offers that meet their flexibility and work-life needs,” she says.

“Junior to mid-level professionals are seeking out opportunities for career progression and professional development. In such fiercely competitive markets, the employers that stand out are those that can offer a well-rounded package that appeals to people’s professional and personal needs in tandem.”

Already, the financial and accounting sector is upping the ante in terms of wages to attract staff and Ms Gorton says some firms are often offering a premium of 25 per cent on top of the starting salary to attract new talent.

“Rising inflation is also driving employers to lift their overall salary budget for the coming year as well by over 20 per cent,” she says. “Given how quickly the market is moving, it is important to regularly benchmark remuneration and adjust talent strategies to remain competitive. Industry insights, such as the Robert Half Salary Guide, can help businesses to benchmark their current salaries against the broader market.”

The landscape has changed in recent years for SMEs in regard to hiring, she says, and job candidates are often dictating the state of play. “Candidates are in the driver’s seat in today’s market and are aware of their bargaining power,” she says. “Strong starting salaries, signing bonuses, and other financial incentives are critical to commanding attention in a tight market, particularly for candidates with hard-to-find technical skills, so it is important that businesses are at or above the market rates for their sector. However, remuneration alone is a brittle attraction strategy that leaves talent vulnerable to the next highest offer.

“Particularly for smaller organisations that may struggle to meet salary expectations, offering greater flexibility benefits has evolved into a must-have for companies who want to tap into a larger talent pool and stand out as an employer of choice.

“Alongside tactical strategies, businesses must not overlook the importance of their core company offering, including employer values and career pathways, and the speed at which they can make an offer to secure top talent. Employers should also avoid pursuing the ‘perfect’ candidate for hard-to-fill roles and become more open to evaluating candidates based on their potential to grow in a role.”

James Marshall, managing partner of MWM Advisory in Queensland, a mid-sized firm, has also been finding it difficult to find staff. He views it as a wake-up call to the industry in terms of how it moves forward on recruitment.

“What COVID has done is highlight an issue that was already there and brought it forward,” he says. “It has accelerated decision making. Previously, people may have been thinking, ‘I’ll quit my job, or start my own businesses, but now they’ve looked up and realised life is short and are acting on it now.

“We saw the writing on the wall five or six years ago.”

Mr Marshall classifies himself and his staff as business advisers rather than accountants per se.

“I grew up in law firms and have been around professional services for a long time and I have seen it change over the years,” he says. “I was in public practice in my twenties, and it is remarkably different now.

“At MWM we spend a significant amount of time helping team members develop soft skills, life skills, career development skills, conversation skills – all the traditional mechanisms of what being an accountant was all about. As accountants we need to offer technical training as well but that only represents one of 10 things, we need to develop in team members.

“The context is that when I started work in the industry in 2002 as an undergrad, the partners looked after me. Computers didn’t do all the work. In fact, a lot of work was floating around learning from more senior staff. There was no automation, and no one trusted the cloud.
“It was an easy way to take on young people and develop them. From day one they were chargeable.

“But what has evolved is that the software guys come along telling us they have software to make your life easy and you won’t have to pay an accountant to do the work anymore. However, what happened is that accountants have lost control of the general ledger, and that makes it harder to bring on a graduate because you have to tell them that 90 per cent of what they will do for the first three to six months is data entry.

“The skill set for accountants evolves slowly but while they are doing the work, rather than the software doing the work, they remain chargeable. That doesn’t exist anymore because of automation.”

Mr Marshall says he uses a simple formula for how much new staff cost his business. “When I put someone on, I have to be willing to lose half of that salary through lost efficiencies,” he says. “I believe that 30-40 per cent of graduate roles have gone because of automation, so as leaders we have to get 30-40 per cent better at what we can offer to staff.

“If you are really interested in a career, I’m not convinced money is the only thing that is considered. Everyone needs to be paid well and patted on the head but if you offer more sugar right now [to candidates] it is more than likely there will be shortcomings in their development.

“I ask candidates if they are not getting all those soft skills in a workplace then they lose out for that extra money and is that a risk they are going to take?”

Mr Marshall says over the past few years a lot of people have left the industry because of the increasing workload, so there is backlog which has to be managed.

“If the phone stopped ringing tomorrow, I reckon I’ve still got six months’ worth of work to get through,” he says. “The industry is starting to change and here’s where I think the issue is – if you look at accountants as a whole, using the DiSC SC profile analogy tool, accountants are SC personality types, they are carers and like details. Those styles of people don’t make good business advisers, and it’s not their fault. The industry needs to change, because basically they are asking conflict adverse people to take risks. It’s got to rebalance as what we define as being an accountant and that may take three to seven years to do that.

“Soft skills lead to personal development, which leads to personal growth and for the light to come in shutters must be open, so as an industry if we’re not willing to take on board some of the things then it is a waste of time.

“One of the things that is missing is an apprenticeship-type thing. The universities and training institutions do tax subjects, but they need to introduce a mechanism that allows more life skills in. We are no longer teaching those fundamental principles because the world has evolved so much – there is no real-world framework now and the transition into public practice as a whole is a different beast these days than it was 20 years ago.”

Ms Gorton says as the skills and labour shortage continue, with decreasing unemployment and spiralling inflation she believes the high job vacancy rate records will be set and broken continuously.

“While warning signs of economic downturn suggest a cyclical market easing are on the horizon, Australia’s labour conditions point to an exceptionally strong and buoyant position from which to navigate potentially challenging market conditions ahead,” she says.

“Our research finds two in five CFOs intend to increase their headcount while nearly half will focus on filling vacant roles — and with the rate of employee turnover in the market, this points to strong hiring demand for the remainder of the year, particularly for finance and accounting roles critical to digitisation, forecasting, and the execution of ongoing growth initiatives.”