Posted on: July 29, 2022 Posted by: AKDSEO Comments: 0

What are businesses doing to retain finance and accounting staff and make job offers more appealing to candidates when they have open positions?

Both can be a challenge. In the spring CFO Survey from Duke University and the Richmond Federal Reserve Bank, three-quarters of CFOs responding said the talent shortage was impacting revenue, and about half indicated it was constraining both revenue and full-capacity operations.

Robert Half’s Staffing Critical Functions Benchmarking Report 2022, released July 20, looks at the problem from the perspective of executives and senior managers in publicly held, private, and public sector U.S. organizations in the United States.

Finance and accounting executives and senior managers have approached the turnover and hiring problems similar to other functions, according to the Robert Half survey. To make jobs enticing, many have increased compensation (58%) and allowed remote work arrangements (48%). 

Slightly less popular modifications to job offers were “increasing paid time off” and being more flexible as it relates to a candidate’s education, years of experience, or skills. (See chart, Sweetening the Offer.) Those actions were slightly more popular in the marketing, tech, and legal departments than in accounting and finance.

To retain employees, about 3 out of 5 finance and accounting departments raised salaries or bonuses (61%). Less than half allowed remote work (43%). (See chart, Keeping Staff Intact.)

Less popular, compared with actions in other functions to reduce turnover, were expanding professional development opportunities for employees, accelerating promotions or job title changes, and letting employees choose their work hours/schedule.

Some of the variations — like being less open to job title changes or faster promotions — might be just the nature of accounting and finance. They could also be a sign that CFOs need to re-examine the entire employment package.

Fortunately, accounting in particular had less employee turnover in the last year compared with other roles, according to LinkedIn data published on June 30. Between July 2021 and June 2022, accounting had a 9.4% turnover rate, the third-lowest after operations and administration functions, LinkedIn said. For finance, the rate was 10%. The highest turnover rate was in HR, 14.6%.

LinkedIn’s interpretation was that “professions [such as accounting] with the least amount of employee turnover deal more with rigid institutional systems, such as budgets, regulations, and business cycles, whereas the professions with the highest turnover rates are more consultative, interpretive, or interpersonal.”

Fair enough, but not all finance jobs can be categorized as such. According to Robert Half’s study, FP&A positions are one of the hardest for finance executives to staff, after “budgets and analysis” and “accounts payable/accounts receivable/bookkeeping.” FP&A jobs require a good amount of consultative, interpretive, and interpersonal skills. So, CFOs would do well to hold onto their high-performing FP&A people.

LinkedIn’s interpretation was that “professions [such as accounting] with the least amount of employee turnover deal more with rigid institutional systems, such as budgets, regulations, and business cycles, whereas the professions with the highest turnover rates are more consultative, interpretive, or interpersonal.”

To do that, of course, employers will have to raise compensation — not just his year but next also. The Salary Budget Planning Report by Willis Towers Watson, of 1,430 employers in the United States, found that companies were budgeting an overall average increase for salaries of 4.1% for 2023, slightly more than the average for 2022.

According to the WTW survey, conducted in April and May 2022, nearly two in three (64%) U.S. employers have budgeted for higher employee pay raises than last year, while two-fifths (41%) have increased their budgets since original projections were made earlier in the year. Less than half of companies (45%) were sticking with the pay budgets set at the start of 2022. 

For employers in finance and accounting and other roles, the message is clear: unless the job market loosens up substantially, be prepared to give up some ground to land and keep good people.