Many of the effects of the pandemic are now firmly in the rear view mirror for many firms, but one major issue remains: whether firms should require staff to return to the office, continue to work remotely, or land somewhere in between.
It’s a question with a different answer for every firm. But it’s one that firms must get right. Choosing the wrong policy will alienate employees. That’s a risk firms can’t afford to take when the industry is in the middle of a talent crisis. In 2020, the AICPA estimated 75% of CPAs met the retirement age, and there simply aren’t enough people coming to replace them, with the number of CPA exam candidates continuing to dwindle every year.
That makes retaining the professionals you already have and creating an attractive workplace for prospective recruits extremely important for accounting firms.
A fundamental part of that equation? Whether you expect your people to be in the office every day or are comfortable with them working from home. Read on as we explore the various issues leaders should weigh as they determine how to navigate this dilemma for their firm.
The Geographic Divide: Where Is Your Firm Based?
In our experience dealing with firms and candidates across the nation, a geographic split has emerged that dictates whether firms are primarily remote or primarily in-office.
In large, metropolitan cities (Los Angeles, New York, Philadelphia, etc.), firms tend to be primarily remote. The same goes for many of the surrounding areas: in much of California and the Northeast, firms continue to operate remotely.
By contrast, firms in the middle of the country, even those in large cities, tend to favor an in-office approach.
Several factors are driving this. Metropolitan, coastal areas largely kept pandemic-era restrictions in place for longer, causing remote work to become the norm. Clients in these areas were more accustomed to interacting with their accounting firm digitally even before the pandemic. Commutes in major cities can easily add 10 hours to the working week.
In less urban regions, clients are more used to dealing with their accounting firm face-to-face. They expect their service providers to be in the office, and there are fewer reasons for them not to be: COVID restrictions tended to be lifted earlier and commutes are often much more manageable.
Understanding The Generational Rift
There’s no denying the cultural differences between Baby Boomers and Millennials. In accounting firms, it’s especially pronounced: partners tend to be Baby Boomers, whereas many service providers are Millennials. This plays out nowhere more clearly than in each generation’s approach to the remote work vs. in-office question.
Baby Boomers have worked in an office their whole lives. They run the firm, and they predominantly want their employees back in the office full-time, the way it always was.
Millennials, on the other hand, overwhelmingly have a preference for remote and hybrid working environments. Remote work has changed their lives (and their productivity levels) for the better. They have more time to spend with their kids, their hobbies, and their work – all as a result of saving hours every week by not commuting. The flexibility of remote work is important to them too, and it’s not something they want to give up.
Interestingly, the youngest employees, Gen Z’ers, actually want to be in the office. They want to get to know their colleagues, learn about the profession, and spend time really immersing themselves in their new environment in a way that working from home doesn’t allow them to do.
Recent years have by and large been a great time for the accounting industry. Demand is skyrocketing and at many firms across the nation, business has never been this good.
All of this growth, or at least large elements of it, has been achieved with employees working remotely. Billable hours are increasing. Remote work eliminates the distractions of an office, replaces the commute with an extra hour of work, and gives employees the flexibility to work in whatever environment works best for them.
If it’s not broken, it doesn’t need fixing. If your firm has enjoyed strong performance over the past couple of years with a primarily remote workforce, why force people back into the office?
Threading the Needle: Creating a Policy That Works
This isn’t an easy issue to solve. But regardless of the route your firm decides to take, it’s important to pay attention to what the wider market is doing, especially in such a competitive labor market.
Firms that require employees to be back in the office are most at risk of losing their top talent. Even if the majority of your employees are happy to be back full-time, it’s safe to assume that not 100% are. The manner in which many metropolitan and coastal firms are embracing remote work means that they’re not afraid to hire talented professionals thousands of miles away – putting you at risk of losing your top practitioners to offers you can’t compete with.
At Premier Financial Search, we’ve placed hundreds of candidates into CPA roles since the pandemic. Today, about 70% of those placements are for entirely remote positions. The other 30% are a combination of in-office and hybrid arrangements. Pre-pandemic, 100% of the clients we placed were office-based. That’s changed forever, and it’s not coming back.
On this issue, the balance of power lies firmly with employees, not partners. Of course, partners could mandate employees to come back into the office full-time, but they do so at their peril.
The likely outcome of requiring everyone to come back into the office? All of your top people start looking for new positions. And since the industry is in a severe labor shortage, they’re not going to have any difficulty finding them. Plus, as a firm that demands your team works in the office, you’re recruiting from a limited geographic talent pool – leaving you with sub-par talent that’s going to set your firm back, not move it forward.
Hybrid approaches offer the best of both worlds, blending primarily remote work with designated office days that bring your team together to collaborate on important projects. But whatever approach you take, take the time to listen to employees and carefully consider your options – you’ll thank us further down the line.
Interested in learning more about building a flexible work environment? Get this free download today: 8 Steps Firms Must Take to Build a Flexible Work Environment LinkedIn Playbook (windingriverconsulting.com)