Wall Street institutions are beginning to tone down their punishing work practices and schedules due to the backlash they have received. Alice Grey Harrison, managing partner at AGH Consulting Group, wrote that the accounting profession needs to follow its peers in finance. This is especially true given the accounting pipeline shortage as well as a generational shift in workplace expectations.  

Writing for CPA Practice Advisor, Grey Harrison said that major investment banks—notorious for their excessive work hours with junior talent as the primary victims—have started to limit work schedules as a response to increasing worries regarding their staff's well-being. Behind the change are general post-pandemic demands from staff for more work-life balance, prompting other sectors to follow suit. 

With the accounting profession facing a talent crisis, these firms have to do the same, The good news is in some firms, this shift is already happening. 

On Wall Street, some firms are changing their email practices to stop sending messages between 7 p.m. and 7 a.m. barring a crisis. The same attempts are being made for weekend emails. Financial institutions are beginning to spend on their staff by providing better health and wellness benefits and more robust professional development opportunities. Smaller institutions have focused on offering better benefits. 

According to Grey Harrison, the accounting profession has been operating similarly to Wall Street banks. This means that employees will usually have to clock in 70-plus hours a week. Those expectations have caused the extreme burnout seen recently and have significantly contributed to the accounting talent problem.  

Based on the Bureau of Labor and Statistics, 300,000 accountants quit their jobs between 2019 and 2021. Many accountants have quit public accounting to take in-house corporate roles that offer more predictable schedules and better work-life rhythms. 

She said labor exits are about to get worse, citing data showing close to 75% of working CPAs are nearing retirement age. If the current hiring dearth persists, this will be catastrophic to the profession’s talent pipeline in only a few years. 

Smart accounting firms, Grey Harrison said, have started to move away from the traditional partnership model. The payoff for the backbreaking work has to wait for 15 to 20 years when they are invited to be partners. Many of these firms are beginning to provide their staff with employee stock purchase plans immediately, which gives people a greater stake in their firm’s outcomes at the start of their work tenure, Grey Harrison said . 

Meanwhile, other companies are moving to project-based or retainer-based pricing models, which is where clients pay by the project instead of being billed by the hour. This reduces the billable-hour mentality, which is needed for true cultural transformation. As long as firms emphasize billable hours, it will be difficult to shift away from the thinking that 60-plus-hour weeks should be the norm. 

Another solution is work-life rhythm plans, which focus on setting career and life balance goals. These plans are unique in that team members develop them based on their individual goals and preferences. They are customizable for individual preferences, and they can partly determine bonuses. 

Currently, it's hard to tell how effectively these reforms will improve retention rates and attract the next generation of accounting talent. Very few younger workers want 90-hour work weeks since they want to engage more outside of work. They also don’t seem to have the same competitive drive that previous generations had, which is why the largest drop-off in talent tends to happen when individuals are about to be promoted to managers, Grey Harrison said.  

Companies should continue to follow Wall Street's lead while also innovating to implement the profession-specific changes that will keep the current pipeline shortage from turning into something generational. She suggested developing work requirements and compensation systems that allow the most junior staff to feel energized and valued. If this strategy is implemented within their first 10 years in a company, retention will improve, becoming the firm's competitive advantage.