“I fear for accounting’s future,” as industry talent shortage looms

Imagine waking up to a financial nightmare. Nobody’s reconciling bank accounts, so you have no clue if you’re bleeding cash. You’re late preparing your own business tax returns and probably incurring penalties as a result. You’re waiting for real-time financial insights that never arrive, so you have to shoot in the dark to make critical decisions. 

That’s the world without accountants, and it’s what we’re barreling toward at this moment.

In my early days in accounting, we didn’t have automation to save us from stacks of paper files, hours of manual reconciliations and the dread of month-end close. But we did have people — skilled teams ready to tackle the workload together.

That workforce we once took for granted is disappearing. And all signs point to the fact that it’s not going to come back.

This isn’t a cyclical talent shortage that will self-correct in a few years. Fewer qualified professionals are entering the field at the same time that aging leaders are exiting en masse. That means you can’t hire your way out of this problem.

There simply aren’t enough candidates, and competition for top talent is fierce. Some are offering increasingly high salaries to attract scarce talent, but it’s a bidding war most companies can’t afford. Training new hires takes months if not years, and when they leave for a less stressful role, you’re back at square one. Meanwhile, those who stick around are overloaded, exhausted and preparing for their exits.

You’re probably already feeling the effects: More burnout and turnover, higher labor costs and longer close cycles.

The modern workload factor

Losing our skilled workforce would be bad enough, but we’re simultaneously facing multiplying demands. Not only is there more work per person, but the business environment accountants must adapt to is evolving faster than any of us can comprehend.

Expanding regulatory requirements

More jurisdictions, nearly infinite complexity. Global tax standards like OECD’s Pillar 2 are forcing companies to overhaul their accounting structures. SOX and PCAOB audits now demand greater transparency and more detailed documentation. And those are only a few examples.

Data: Empowering and limiting

Finance has gone real-time. Stakeholders want on-demand insights, not last quarter’s numbers. Subscription volumes, e-commerce and global operations have all contributed to higher and higher transaction volumes.

Digital transformation downsides

I’ve seen firsthand how well-intentioned digital transformations backfire when they aren’t executed with accounting in mind. Companies adopt new procurement systems and AI-driven expense-tracking tools and migrate to cloud-based invoicing without integrating them properly. Instead of simplifying workflows, they make it harder for accountants to chase down data. What should be an efficiency boost is instead an administrative burden. Because businesses are adopting new tools at such a wild pace, the problem is only getting worse.

Stuck in the mud of accounting education

I’ll be honest: Universities are preparing accounting graduates for a world that no longer exists. They learn how to do paper-based journal entries and tax prep exercises that have little relevance in today’s digital environment. They’re also often entering the workforce with zero experience in automation or AI — both must-haves. There’s such a wide gap between academic priorities and industry needs, and it’s a problem for both employers and job seekers.

This just fuels the perception that accounting is a boring, number-crunching job, and — let’s be real — there was a time when it was. Modern accounting, though, is data-driven, strategic and essential to business growth. It can be a fulfilling, lucrative career for smart, ambitious people. We’re failing them and our businesses by not addressing the educational rift.

Automation: A competitive advantage in the accounting talent war

If you can’t hire more accountants, you need to make the ones you have more efficient. Staying buried under transactional tasks such as manually processing invoices, categorizing expenses and keying in journal entries is not a scalable choice. Automating repetitive tasks is no longer optional if you want to stay competitive.

Without automation, something like accounts payable and receivable (AP/AR) can be unnecessarily complex and time-consuming. Invoices can pile up in inboxes, payments and approvals stall and you end up with cash flow disruptions and strained vendor relationships. Automating AP/AR can handle the processes from start to finish with minimal human intervention.

That, in itself, is an incredibly enticing outcome. But there’s an even greater one: Automating a few workflows creates a compounding efficiency effect. You set a precedent for hands-off data tracking, approval notifications and report formatting that enables you to build out more seamless handoffs between systems and teams. Those month-end close cycles that once took weeks can be reduced to days — or hours!

Companies that have embraced accounting automation are seeing measurable gains. Read the story of how biotechnology company Genentech reduced close times by over 50%.

AI and automation won’t take your job — but they will change it

The best technology is the kind that eliminates the work no one wants to do. Both automation and AI fit the bill. Technology-enabled accountants become business advisors, proactively identifying budget issues and revenue opportunities or helping your teams understand financial impacts.

A shift is already underway: Transactional work is decreasing, and accountants are becoming more integral to financial decision-making. The distinction between finance and accounting roles is blurring, and neglecting this trend by avoiding new technologies will leave your business under the proverbial rock.

To win the talent war, you have to join the fight! 

The future of accounting is digital, automated and strategic. Those who recognize this shift and invest in the modernization of both tech and people will lead the profession into its next stage of evolution. Those who resist? They’ll watch their few talented accountants leave for workplaces with better tools and fewer headaches. 

I’ve worked in this profession long enough to see that change is inevitable, but how we respond to it is up to us. Not jumping on the automation train is a risk that I, for one, am not willing to take on behalf of myself, my employer or my team.

Redwood Software is here to guide your foray into accounting automation with the powerful platform and 24/7 support you should have. Start exploring record-to-report automation.