Below, we summarise the common key themes that emerged from employers at large regional firms, small firms in Cambridge and Norwich, and those working in industry. These key themes included recruitment and retention challenges, apprenticeships and training, trainee attitudes and behaviours, workplace cultural changes, and audit.

Recruitment and Retention Challenges

A consistent theme across all discussions was the difficulty in recruiting and retaining qualified staff. Firms struggle to attract high-quality candidates and are often forced to lower their standards, leading to longer-term issues. Below are some of the comments from different employers about their current experiences with recruitment and retention.

Large Regional Firms:

• • Recruitment and retention are challenging due to low-quality newly qualified candidates. It is therefore difficult to get and keep the right people to perform roles.
  • Firms are finding that they would prefer fewer high-quality candidates rather than increasing cohort sizes with lower standards.
  • Client expectations demand immediate service, adding pressure on firms.
  • Managers need management training. Staff are often being promoted to management level too fast and therefore struggle with appraisals and managing a team.
  • Employers are finding they have to keep quiet about staff qualifying and other achievements and only celebrate internally for fear of poaching by recruitment agencies.

Cambridge Small Firms:

• • A severe shortage of qualified staff, especially in audit, leads senior staff to continue handling audits.
  • It is incredibly hard to recruit good trainees. Recruiters try to poach and place trainees. Trainees are lured by big promises from recruitment agents, making them expensive to an employer. Furthermore, counter-offers from employers are driving up salary expectations, making recruitment of young adults even harder.
  • Work is busy which is driving ‘stress recruiting’ where the wrong people are taken on leading to problems further down the line.
  • Recruitment challenges include the cultural differences between UK and non-UK applicants.
  • Employers are finding they must start building relationships earlier with potential trainees and have had to make application processes easier.
  • The application process needs to be made as easy as possible to attract good candidates.
  • Preference for AAT-qualified candidates over graduates. AAT candidates are more mouldable, and graduates do not pay for themselves until a year after qualifying.
  • Employers are recognising the benefits of deferred start dates so candidates can have personal development and growth before starting a role.

Norwich Small Firms:

• • Candidates often show poor preparation and knowledge when interviewing for roles with a lack of proactivity.
  • Rural firms struggle to attract candidates due to less appealing locations. Employers are training staff for them to then leave to larger local employers who can pay more and give more holidays. Smaller firms can’t compete with industry; salary, holidays, and maternity cover.
  • The attitude of Gen Z prioritises work-life balance over work ethic, leading to concerns about employability, particularly with the pressure on salary expectations.
  • A preference for school leavers over graduates due to better commitment and quicker usefulness.
  • The rise in minimum wage is impacting employers as fees have not changed in line with salary changes.

Industry Clients:

• • Retaining low-level roles and managing large volumes of learners is difficult.
  • Challenges with engaging 16-18-year-olds and maintaining their concentration on work.
  • Recruitment across all levels faces competition from higher-paying companies. They are having to look at other aspects to appeal to candidates. It is also hard to find the right candidate at lower levels.
  • Firms are bringing external recruitment in-house to save costs due to needing to hire so frequently.
  • Employers need to be very open about salaries and benefits as early as possible to reduce reneges.
  • Employers are focusing on non-financial benefits, such as a positive office environment, strong leadership, and cultural investment, to improve retention.

Apprenticeships and Training

Apprenticeships are an extremely valuable training route into accountancy, but businesses face challenges in balancing the demands of the workplace with the educational needs of apprentices.

Large Regional Firms:

• • Apprenticeships are highly valued but have been impacted by workplace pressures and funding issues.
  • Level 4 apprenticeships are being reconsidered due to time and cost constraints at other levels, level 7 may not be needed if levels 3 and 4 are completed.
  • Graduates could benefit from some aspects of skills training.

Cambridge Small Firms:

• • Firms are debating whether to do level 4 apprenticeships commercially due to the impact of chargeable hours and employer contributions.
  • Deferred start dates for candidates can provide personal development experiences.

Norwich Small Firms:

• • A shift towards apprenticeships for levels 3 and 4 instead of level 7 is noted due to administrative and training challenges.

Industry Clients:

• • Consistent demand for apprenticeships exists, but issues with low pay and administrative burdens are prevalent.
  • Preference for commercial or distance learning over level 7 apprenticeships due to funding constraints.

Trainee Attitudes and Behaviours

Trainee behaviour and attitudes were a significant concern, with firms seeing a shift in expectations and work ethics.

Large Regional Firms:

• • Trainees often do not work hard enough, need handholding, and do not engage with alternative viewpoints to their own.
  • Enthusiastic and outgoing, breaking traditional accountant moulds.
  • High expectations from both school leavers and graduates, but they lack appreciation for the bigger picture, can be self-centred, and do not take responsibility for their actions and how they impact others.
  • Perceptions of students as entitled and lacking practical experience, particularly in tax.
  • The new generation is digitally savvy but impatient, demanding transparency in salaries, quick promotions and careers with development opportunities, whilst often not willing to put the hard work in to get them.
  • Firms are not always good at giving the constructive criticism that young adults need to aid development, especially as employers fear employees will leave if they do.

Cambridge Small Firms:

• • Many young staff need help with handling interactions with people and cannot manage tasks.
  • Frustrations with the attitude of trainees. They expect to be spoon-fed and expect instant availability of answers.

Norwich Small Firms:

• • There is a preference for school leavers over graduates due to better commitment and quicker usefulness.
  • Graduates tend to prioritise salary expectations over work ethic, making them less employable.
  • Gen Z does not work hard as work-life balance is such a priority for them.

Workplace Cultural Changes

Alongside trainee behaviour and attitudes, firms are also noticing workplace cultural changes in the new generation entering the workforce, which is impacting the way the old workforce is having to respond. Employers commented that:

Large Regional Firms:

• • The new generation of workers is more digitally savvy, particularly when using systems.
  • They are impatient and want progression and promotion quickly.
  • Young professionals want transparency in salaries and career progression, this is forcing firms to be more accountable.
  • They expect firms to invest in their development and build progression programmes.
  • There is a need for strong people management and constructive feedback, with senior leaders showing vulnerability and a culture of openness about mistakes.

Cambridge Small Firms:

• • The role of directors is to show work-life balance/flexibility of hours to appeal to young professionals.
  • Most firms need a flexible working policy. The general rule around flexible working is 3 days in the office and 2 days out. However, flexible working policies require a two-way trust between employers and employees and consequences if work is not produced to standard.
  • Personality profiling and management development training are useful tools for managing the new generation of workers as well as reducing qualified staff turnover.

Audit

Audit resourcing was a recurring concern, particularly for smaller firms.

Large Regional Firms:

• • Trainees need to be inducted better, whilst partners and managers need to learn that there are generational issues. Younger workers need to build resilience.

Cambridge Small Firms:

1. • Audit resourcing and task management are challenging due to high work volumes.
   • Some firms are considering pulling out of audit due to difficulties in attracting and retaining staff.
   • Higher fees for charity audits and sacking difficult clients are some strategies being adopted.

Norwich Small Firms:

• • The impact of higher minimum wage for employees and generally higher salary levels, alongside fees that have not changed much, mean that it is not possible to take some work.

Industry Clients:

• • Losing low-level roles.

The roundtable discussions highlighted common themes experienced by employers across sizes, industries, and regions. This indicates that although different firms may be experiencing their individual challenges, overall, a lot of problems are shared across the accountancy industry. It may be helpful for accountancy firms to recognise these common themes as industry-wide and offer the potential for businesses to work together to help overcome mutually shared issues.

You can read more about topics impacting accountants here.