Does your accounting firm allow employees and freelancers to work remotely?
With advancements in telecommunication tools, people can now perform numerous jobs without needing to be in the same city as their employers, and this includes those working in accounting. The concept of remote accountants may seem daunting at first, but hiring accountants remotely is critical for your firm in the long run.
Here at Gusto, we want to supply our accounting clients with the knowledge and support they need to strengthen their firms and assist their clients. That’s why Gusto, along with our partners at CPA Academy, presented an edifying webinar all about the importance of remote accounting.
Our webinar titled “How to Hire Freelance Accountants For Seasonal Work and Short Term Projects” featured the remote hiring expertise of Jeff Phillips, the Co-Founder of Accountingfly and the CEO of Padgett Business Services. You can watch the full webinar here.
In this article, you will learn all about remote accounting industry trends, how using remote accountants can reduce your firm’s turnover rate, and why remote work will play a critical role in the future of accounting.
The growth of remote accounting
Freelance work plays a critical role in modern-day accounting, and hiring remote freelancers is becoming increasingly necessary. Jeff encouraged firms to get used to working with remote employees because working remotely with accountants may become the new normal within our profession. He speculated that around half of the employees within the average accounting firm will eventually work remotely:
“50% of your team will work in and out of the office, and 50% will work from home. That’s because some of your team will be full-time remote employees who might work in the location of your headquarters, but also may work … in some other city because you hired full-time permanent remote people. The other half of that remote workforce could be a temporary freelance team that comes in and out for busy season … or for certain audit projects.”– Jeff Phillips
Whether you’re staffing full-time employees or freelancers, you’re more than likely going to work with many remote accountants in the near future. A major factor contributing to the need for remote accountants is that the accounting industry is suffering from a labor shortage. There’s an ever-growing increase in knowledge economy jobs, and there aren’t enough suitable candidates to fill accounting positions. Additionally, the unemployment rate for accountants is incredibly low, meaning that very few are looking for work:
“Going back to 2019, the unemployment rate for accounting and audit was 1.8% according to the Bureau of Labor and Statistics. So if you’ve ever posted a job on a job board and got very few relevant applicants for an accounting job, it’s because everyone is hired. … There is no surplus of talent looking for jobs.”– Jeff Phillips
With the labor shortage, you need to find candidates wherever you can. Rather than focusing on hiring a candidate who lives in your city or is willing to relocate, you’ll significantly increase your chances of finding a quality hire when you’re willing to employ remote accountants.
The labor shortage of accountants will only increase over the course of the next decade because, as studies indicate, there will be an additional 50 million more knowledge economy jobs forming. It’s already difficult to find a qualified accountant looking for work, and the demand for accountants is only going to increase. You need to start hiring remote workers so that your firm is always fully staffed and you can take on your clients’ workload.
How remote work can reduce your firm’s turnover rate
A critical factor contributing to the labor shortage within the accounting industry is the remarkably high turnover rate for smaller firms. Firms with less than $20 million of revenue suffer a turnover rate of 25%. With that high of a turnover rate, you need to offer appealing full-time and freelance positions that retain employees and help you fill new positions quickly.
A substantial portion of the modern accounting workforce prefers to work remotely. A significant contributing factor relates to the fact that millennials are the largest demographic within the accounting profession:
“I attribute a lot of the rise of remote work to the millennial generation because they came in and demanded more flexibility than my generation, the Gen X-ers and anyone before. … I think the vast majority of millennials are dual-income families. That means mom and dad are working [and] taking care of sick kids.”– Jeff Phillips
Unlike previous generations, millennials have dual-income families, which means they need jobs that allow them to stay home with their kids. Remote work allows employees to have an easier time working and taking care of their families at the same time. Millennials are more likely to exit a job if it doesn’t offer remote work, which contributes to the high turnover rate of traditional public accounting firms:
“There has to be this anytime, anywhere work availability for a millennial to want to take a job with you. … So much of the traditional public accounting firm market said ‘no’ to this. … That’s why you see … 25% turnover because they didn’t [offer remote work for accountants]. It’s an easy change to make. It’s an obvious change to make. The firms that do [hire remote] seem to be keeping more millennials than the firms that don’t.”– Jeff Phillips
Offering your accountants the option to work remotely makes your firm far more appealing. If your firm doesn’t offer remote work, your accountants can find a firm that will. You’ll potentially lose some of your best accountants if you don’t provide remote options because they can always find a different firm in the current labor market. You need to be willing to work with remote employees and freelancers so that you can find new quality hires quickly and retain your current talent.
Remote work is here to stay
Hiring remote workers is critical for the growth of your firm. It will enable you to find the best available candidates across the country:
“You can’t build the team you need … to generate growth … without having remote [be] part of your strategy. … You will find the best people available if you open up your employment search. … You’re opening up to the entire labor market.”– Jeff Phillips
When you hire remote workers, you gain access to the entire knowledge economy workforce currently available. You’ll be able to find quality candidates significantly faster than if you hire locally.
Your ability to hire new full-time and freelance workers quickly will also reduce pressure on the other accountants working in your firm. If your accounting position stays vacant, then that creates more work for your current staff, which can lead to more turnover:
“The consequences of filling the jobs faster are [that] your turnover will decrease. … Your staff will be less burnt out. It really changes your employment brand.”– Jeff Phillips
Working with remote accountants is essential for improving the quality of life of your current staff.
Hiring remote accountants is clearly beneficial for your firm, but many argue that remote workers do not work as hard as office workers. In reality, certain case studies indicate that remote workers are more productive than their in-office counterparts.
“When people think of remote work, a lot of them think about millennials … traveling the world, sitting on a beach, sipping a chocolate martini or a Mai Tai. That is a misconception. … People are working from their home offices, and they value the immense flexibility that [allows them] to run a family, handle responsibilities, and be productive on their terms. … Remote work isn’t going anywhere. So let’s become … remote-friendly organization[s].”– Jeff Phillips
Bottom line: Remote accounting is critical for your firm. You can find quality, hardworking remote freelancers and full-time employees quickly so that you can reduce your turnover rate and expand your firm.
Learn more about remote accounting
Accounting firms have a challenging time finding and retaining quality accountants because of their low unemployment rate. As the number of knowledge economy jobs increases, so will the necessity to hire accountants remotely. Rather than resisting remote work, you can embrace it and begin finding quality candidates all over the country. You’ll be able to fill your firm’s available positions and hire freelance workers to address your clients’ needs and expand your firm.
If you’re looking for more ways to expand your firm and better serve your clients, consider signing up for Gusto. Gusto is a people-based platform that makes payroll easy for accountants. We provide critical tools for businesses like HR, health insurance, and benefits, and we provide automatic tax filing for local, state, and federal payroll taxes. Learn more about how Gusto can help your firm and your clients by visiting our Gusto for accountants page.