Memo to members urges firms to use layoffs as last resort.
“In today’s tough economic times, the AICPA is aware that some firms are tightening their belts and considering cost-saving options,” says the memo, which is full of great resource links. “The AICPA is concerned with the well-being of our individual members and member firms”
- As a first step, the AICPA provides eight alternatives to layoffs, ranging from improved staff coaching for better productivity to cutting partner pay.
- Prepare the staff with regular and honest communications.
- When all else fails, be professional and respectful and, above all, know the law.
“We all know that the current economic climate will change for the better in the future,” says the AICPA. “What we don’t know is when things will start to turn around.”
What are you seeing? Leave a comment here.
[Update 5:45pm ET, April 15, 2009]
Meanwhile, let’s not get the wrong idea. The AICPA’s Mark Koziel says here in comments:
Rick, AICPA isn’t saying its going to be bad, just that some firms are considering cost savings options. We want to see every option exhausted before layoffs and if it comes down to it, offering help to the few who may need it. It’s not time to say the sky is falling as many firms are still doing quite well.
We continue to help the firms who are doing well in PCPS and wanted to be sure to help those who may need it. I wouldn’t say that’s a grim outlook, just trying to help all firms out there.
And I agree. The outlook may be cause for concern, but the vast majority of CPA firms are coming off one of their best tax seasons in memory. And tax prep firm valuations are up 9%. Layoffs are the last thing firms should be doing.
8 Responses to “AICPA advises members, firms on cutbacks and layoffs [UPDATED]”
Kevin Wells
Personnel in smaller owner managed firms should always consider the clientele theirs and when laid off should take the clients with them. Personal service works that way.
noname
The Anderson flooding of the market turned out to be the best thing for accountants salaries. The shortage caused salaries of qualified CPA to soar in a very hot market. As a non-partner, I have to agree with the Big 4 layoffs. Afterall it means salaries will rise again. Keep abusing the professional staff then pay for it later.
Allan FIsher
On a daily basis I am speaking with candidates who have been “laid off”. Most of these candidates are from the Big 4, Nationals and Regional firms. The majority of these candidates have 0-3 years of experience. Sadly, I am hearing that these candidates are leaving the geographic area to pursue opportunities, leaving public accounting to pursue private industry and in many cases, considering leaving accounting entirely. Most of these candidates are not invested enough in the profession and have not yet become certified. Additionally, I am hearing that they are pursuing positions in education, law enforcement and government where they feel they can quickly replace their 45,000 – 50,000 salary.
This situation is eerily similar to what happened when Andersen collapsed and the market was flooded with Big 5 candidates.
Within a few months, all of those candidates were absorbed by other firms, corporations or other industries. Withing a year, we had a shortage of talent that lasted from 2002 to 2008.
Once the economy begins to recover (and it will) and once companies start to contemplete IPO’s and M&A’s (and they will) the Big 4 will begin to aggressively hire. Because so many qualified staff will have left the profession, we will again be in a situation where there is not enough talent.
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Mark Koziel
Rick, AICPA isn’t saying its going to be bad, just that some firms are considering cost savings options. We want to see every option exhausted before layoffs and if it comes down to it, offering help to the few who may need it. It’s not time to say the sky is falling as many firms are still doing quite well.
We continue to help the firms who are doing well in PCPS and wanted to be sure to help those who may need it. I wouldn’t say that’s a grim outlook, just trying to help all firms out there.
Byron Patrick, CPA.CITP
I suspect this memo is 8 weeks too late
Bonnie
No layoffs but we just had two people quit. One moved back to her hometown and the other left the profession.
No name, please
Thanks Rick for all your updates. Can’t get the straight stuff any place else these days.
We’ve already started cutting 15% of staff. And it’s going to be hard for those people to find jobs in this market. I really feel for them. It hasn’t hit the partners yet. But it will if business doesn’t come back by next year this time.