Retention as a Recruiting Strategy

We're very lucky this week to be able to share this article authored by Bonnie Buol Ruszczyk.

Why Fair Hiring and Promotion Practices Matter More Than Ever

The accounting industry is facing an undeniable challenge: too many open positions and not enough qualified professionals to fill them. According to the AICPA 2023 Trends Report, the number of accounting graduates entering the profession continues to decline, while demand for skilled accountants is only increasing. The result? A growing talent gap that makes retention just as important – if not more so – than recruitment.

Yet, at the same time, some firms are pulling back on diversity, equity, and inclusion (DEI) initiatives, citing political pressures or fear of legal challenges. In doing so, they risk eliminating the very practices that help retain top talent – particularly women and professionals from underrepresented backgrounds, who make up an increasing share of the workforce but are not seen in the ranks of leadership in comparable numbers.

The Hidden Cost of Ignoring Fair Practices

Losing an employee isn’t just inconvenient, it’s expensive. Research indicates that replacing a highly skilled professional can be as high as 50% to 60% of an employee’s annual salary, with overall costs ranging anywhere from 90% to 200%.

For accounting firms, where talent shortages are already putting a strain on client service and firm growth, every departure hurts. And yet, research consistently shows that employees leave when they don’t see clear paths for advancement, don’t feel valued, or perceive bias in hiring and promotions.

• On average, 75% of employees who voluntarily left their jobs said it was due to a lack of career growth opportunities.
• Women, who make up more than 50% of accounting graduates, hold only 27% of partner roles in U.S. firms.
• Turnover among women and professionals from underrepresented backgrounds is significantly higher when firms fail to offer clear, equitable advancement pathways.

Retention isn’t just about offering a competitive salary or a hybrid work option, it’s about making sure all employees see a future at the firm.

Fair Hiring & Promotion as a Strategy for Retention

Some critics of DEI claim that fair hiring and promotion efforts lead to unqualified candidates being chosen over more deserving ones. But let’s be clear: No one who supports fair hiring is asking firms to lower their standards. In fact, the opposite is true.

Effective hiring and promotion processes should be based on merit, skills, and potential, not on personal relationships, gut feelings, or an unconscious bias toward those who look and think like existing leadership.

Historically, firms have often relied on "who you know" hiring, whether through referrals or unstructured interview processes that favor those who “fit in” rather than those who are truly the most qualified.

• Testing candidates and employees for actual skills, rather than relying on subjective evaluations levels the playing field and ensures that firms are retaining and promoting the best talent, regardless of background.
• Standardized assessments help identify high-potential employees who might otherwise be overlooked because they don’t fit outdated expectations of what a leader should look like.
• Transparent promotion criteria give employees confidence that they will be evaluated fairly, leading to greater engagement and long-term retention.
  
  

At the end of the day, fair hiring and promotion practices are not about giving someone an unfair advantage, they’re about making sure firms aren’t missing out on top talent just because of unconscious bias or unintentionally unfair methods of evaluating candidates.

Ignoring Fair Practices Won’t Make the Problem Go Away

While some firms may feel pressure to distance themselves from DEI efforts due to political or legal concerns, the reality is that failing to build a workplace where all employees feel valued and have opportunities to advance will hurt firms in the long run.

Accounting firms can’t afford to lose any talented professionals, let alone those who may already feel marginalized. By implementing hiring and promotion processes that emphasize skills, potential, and fair evaluation methods, firms strengthen their workforce, improve retention, and stay ahead in an increasingly competitive industry.

Where to Start? Test, Measure, and Improve

For firms looking to retain top talent and ensure fair hiring and promotion practices, consider:

• Using standardized skills assessments in hiring and promotions to evaluate ability, not just familiarity or “fit.”
• Providing transparent career growth pathways so employees know exactly what it takes to advance.
• Regularly reviewing internal promotion data to identify and correct any unintentional biases in the system.
• Investing in mentorship and sponsorship programs to ensure that high-potential employees – especially women and professionals from underrepresented groups – have access to the same opportunities as their peers.
  
  

At a time when accounting talent is in short supply, firms that double down on fair, strategic hiring and promotion practices will be the ones that retain their best employees, strengthen their leadership pipeline, and ultimately thrive.

Let’s not let short-term political pressures derail the long-term success of the profession. Fair hiring and promotion aren’t just the right thing to do, it’s the smart business move.

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A huge thank you to Bonnie Buol Ruszczyk owner of the Accounting MOVE Project for generously allowing us to republish this article.

Bonnie Buol Ruszczyk (like “rustic” without the “t”) is the owner of the Accounting MOVE Project, the only annual benchmarking research and advocacy report that equips accounting firms to detect, develop and drive competitive advantages from diversity initiatives and trends.

She is also a marketing consultant with bbr companies where she provides strategic guidance, project management and serves as an outsourced marketing director for firms that don’t need that resource full-time.

Finally, she is also co-owner of Rally Rounds mastermind groups which provides support, ideas, and accountability for accounting growth professionals. She has served the accounting profession since 2007 and has been named as one of Accounting Today’s Top 100 Most Influential People in Accounting six times.

Giles Pearson  |  After 18 years as a partner with a large public accounting firm, Giles founded Accountests to help those recruiting accountants make better hiring decisions

Accountests  |  Accountests deliver the world’s only online suite of annually updated and country-specific technical skills, ability and personality tests designed by and for accountants and bookkeepers.