Magazine article The CPA Journal

Concern for the Future of the Accounting Profession

Magazine article The CPA Journal

Concern for the Future of the Accounting Profession

Article excerpt

According to the U.S. Department of Labor's Occupational Outlook Handbook, 2000-2001 edition, growth in employment for accountants and auditors is anticipated to be 10-20% during the period 1998-2008. Other studies and evidence point to a troubling disparity: The number of accounting graduates has substantially declined, and this decline is likely to continue alongside this growing demand for new professionals.

An AICPA survey published last year documents a decrease in the supply of accounting graduates currently and in the immediate future. "The Supply of Accounting Graduates and Demand for Public Accounting Recruits (conducted in the spring of 2000)" reports that the number of accounting degrees awarded (bachelor's and master's) for the 1998/99 academic year was 47,895. This is the lowest level in 25 years and represents a 20% decline from the previous AICPA survey, for academic year 1995/96. The report also indicates an even more severe decline in terms of accounting enrollment (excluding PhDs) for this same period: Accounting enrollment decreased by 22%, from 191,560 in 1995/96 to 149,040 in 1998/99. This was after experiencing a 10% decline in accounting enrollment between academic years 1994/95 and 1995/96.

Interestingly, this AICPA survey also indicated that the majority of accounting program administrators believed that in all areas of accounting study (e.g., bachelor's, MBA with accounting concentration, MS in accounting or taxation) enrollments will be the same or higher two years in the future. Yet recent enrollment numbers don't bear this out, particularly considering the decline in the number of high school students that plan to major in accounting, the future implications of the 150-hour education requirement, and the relatively low starting salaries in the field.

Additionally, according to the Taylor Research & Consulting Group "Student and Academic Research Study" commissioned by the AICPA, the percentage of college students majoring in accounting dropped from 4% in 1990 to 2% in 2000. More indicative of the future supply of accounting graduates, the percentage of high school students planning to major in accounting declined from 4% to 1% during the same period.

The increased education requirements for CPA licensure have further negative implications for the future supply of accounting graduates. …

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