You would think projecting employment prospects for the accounting field would be a no-brainer and research shows for the most part the outlook for the accounting profession is expected to be good.
Many Americans wonder where their tax dollars go, a small part proportionately goes to the Bureau of Labor Statistics. (BLS). Predictably, they do studies and most recently The Job Outlook for Accountants and Auditors, found in the Occupational Outlook Handbook is worth reading in its entirely.
In 2016, the government counted 1,397,700 people working in the field as auditors and accountants. By 2026 they anticipate a growth of 10 percent or 139,900 jobs, bringing total employment to 1,537,600.
Over the next eight years many CPAs will retire, which is significant growth because it’s growth over and above filling jobs as CPAs retire. Also worth noting, for the first time the number of partners over 50 declined from 69.9 percent to 65.6 percent, due to retirements. The national average is about 55.7 percent in smaller firms.
Why is the Profession Growing?
The BLS report gives four reasons for growth:
1. A Growing Economy. More new companies means more financial records to be analyzed and reported.
2. More IPOs. Once a private company goes public, the amount of financial reporting increases substantially.
3. Globalization. Doing business overseas means complying with multiple tax codes. There are issues related to M&A and trade.
4. Technological Advancement. While routine accounting tasks will be more automated, the advisory and analytical role of the job will move to center stage.
Where’s the Demand for Accountants?
The BLS also reports the top five states for growth in the accounting profession will be California, Texas, New York, Florida and Pennsylvania.
The BLS assembles statistics on multiple job descriptions. “Financial Managers are responsible for the financial health of the organization. They produce financial reports, direct investment activities and develop strategies for the long term financial goals of the organization.” The career track is often through the accounting and auditing profession.
The BLS estimates demand between 2016 to 2026 to increase by 19 percent vs. 10 percent for the accounting profession. They feel the need for cash management and risk management will drive growth in the field.
Planning, directing and coordinating investments is another part of the role. With 580,400 people employed in the field in 2016, it’s expected to increase by 108,600 jobs by 2026. The field pays more than the accounting field, in 2017 the Mean Pay was $ 125,080/year.
Similar to accounting, the states with the most demand are California, Texas and New York. The other states in the top 5 are Massachusetts and Illinois. This may likely correspond to the states with the highest concentration of head offices for listed public companies.
The BLS has an overall job growth projection for all occupations as 7 percent over the 2016 – 2026 period. With 10 percent growth in the accounting sector and 19 percent growth in the financial manager sector, skills within this industry are in high demand.
Bryce Sanders is president of Perceptive Business Solutions Inc. in New Hope, Pennsylvania. He provides high-net-worth client acquisition training for the financial services industry. His book, Captivating the Wealthy Investor, can be found on Amazon.com.