There is a real shortage of good quality accountants around, so much so that it is holding back many firms’ growth plans. And the fact that students of the principle institutes are already trained in international financial reporting standards only adds to their marketability, as larger firms and companies seek to improve their knowledge base in this area.
In its new ACA Career Handbook, Morgan McKinley says newly qualified accountants going into the City are once again enjoying high starting salaries. The figures, to be published next month, will show that growing demand for new chartered accountants has pushed up basic starting salaries across the board in key business areas. Reports of double-digit annual rises are reinforced by recruitment consultants.
As well as IFRS – not to mention Sarbanes-Oxley and other compliance legislation, as well as the ‘Turnbull guidance’ on risk management and corporate governance – there is another factor fuelling demand. And it’s a problem of the profession’s own making.
Many firms have been alarmingly short-termist in recent years. The number of qualified accountants coming on to the market is lower than it would have been because of intake freezes or head-count reductions by many big firms during the recent downturn. The relative shortage of qualified accountants is having the inevitable effect of pushing salaries upwards.
Lessons do need to be learned. Despite Gordon Brown’s intentions when he became chancellor in 1997, the ups and downs of the economic cycle are still very much with us and, unfortunately, always will be.
So when we come out of this upturn, businesses – and firms in particular – should remember that cuts in intake one year will only push up recruitment costs down the line. But there is a lesson here for newly qualfieds too – make hay while the sun shines, as the good times will not last forever.
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