How does the accounting profession fare during recessions?

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awg90
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How does the accounting profession fare during recessions?

Post by awg90 » Mon Apr 20, 2020 7:17 pm

I'm guessing the accounting profession does okay during recessions, would this be accurate?

I'm considering getting my master's in accounting, as my current industry goes up in flames. I have an undergrad in something not related to accounting, but I did take a course in accounting which I enjoyed.

Any insight into how hiring is for the big four etc during recessions?

Thanks!

Cpadave
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Re: How does the accounting profession fare during recessions?

Post by Cpadave » Mon Apr 20, 2020 7:21 pm

The only profession I am aware that is not impacted by recession much is healthcare and k12 teaching. I am retired now, but I remember experiencing hard time finding job during recessions.

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yangtui
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Re: How does the accounting profession fare during recessions?

Post by yangtui » Mon Apr 20, 2020 8:25 pm

I think it does ok. If you are halfway decent you will probably be able to find a job in almost all economic environments. The job might be really lousy but at least it is a job. Even during good times you are not immune from corporate restructuring, cost cutting, and outsourcing. I know some very smart people with very high paying jobs that still need to find a new gig every 5 years or so. I also know of some very successful accountants that died from stress when they hit their 60s. If you are organized, detailed oriented, and efficient, then it is probably a good fit for you. If you are going to get your masters make sure you will be CPA eligible after you graduate and that the school has employers you are interested in recruiting there. Also be aware that age discrimination comes into play for a lot of roles. This is definitely true for Big 4 entry level jobs. Recruiting for Big 4 roles becomes more competitive during recessions. They always hire people but instead of hiring 20 they might only hire 2. They will also churn people faster as well to keep the talent pipeline from clogging up.

This article does a good job discussing what happened to accounting grads during the GFC.
http://retheauditors.com/2012/08/09/wai ... pa-review/
Last edited by yangtui on Mon Apr 20, 2020 8:36 pm, edited 2 times in total.

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TheAccountant
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Re: How does the accounting profession fare during recessions?

Post by TheAccountant » Mon Apr 20, 2020 8:29 pm

I’m still employed (industry.) Working remotely full-time and able to perform all of my job duties from home.

From what I’ve seen, most firms have put off their hiring due to the uncertainties surrounding the Coronavirus. It seems like a lot of firms/companies are trying to make do with their current staff, rather than onboard someone new and then try to train them remotely.

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Re: How does the accounting profession fare during recessions?

Post by AerialWombat » Mon Apr 20, 2020 8:43 pm

It largely depends on what area of accounting you are in. If you’re working in industry at a MegaCorp, you’re fairly critical to the company and have reasonable job security. If you’re in public accounting on the consulting side, there is a higher risk of layoff. Audit and tax, you’re more likely to be kept around. If you’re doing investment banking, well, remember 2008?

In short, the closer your job is to a critical compliance function, the more secure your job should be. This isn’t an absolute, of course.

I’m in a specialty tax area that is effectively recession proof. It’s a good place to be.

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Random Musings
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Re: How does the accounting profession fare during recessions?

Post by Random Musings » Mon Apr 20, 2020 9:04 pm

Regardless of economic conditions, accounting is an accrual world.

RM
I figure the odds be fifty-fifty I just might have something to say. FZ

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AerialWombat
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Re: How does the accounting profession fare during recessions?

Post by AerialWombat » Mon Apr 20, 2020 9:06 pm

Random Musings wrote:
Mon Apr 20, 2020 9:04 pm
Regardless of economic conditions, accounting is an accrual world.

RM
Yikes. Accounting puns are quite taxing.

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Re: How does the accounting profession fare during recessions?

Post by montanagirl » Mon Apr 20, 2020 9:49 pm

Cpadave wrote:
Mon Apr 20, 2020 7:21 pm
The only profession I am aware that is not impacted by recession much is healthcare and k12 teaching. I am retired now, but I remember experiencing hard time finding job during recessions.
Healthcare? You must be kidding, with all the furloughing going on now. And teachers get laid off too, for that matter, when tax revenues dry up.

I don't believe there are secure jobs anymore.

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lindsayinsf
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Re: How does the accounting profession fare during recessions?

Post by lindsayinsf » Tue Apr 21, 2020 2:15 am

Can't speak to a big four type accounting job, that could probably vary depending on your department/specialty and clients.

I work in financial & managerial accounting at a mid-size professional services firm with clients that fared well in the last recession (big tech companies). Accounting is not the service we provide (I am "support" staff) and during the current pandemic have retained almost all of our employees. The size of my firm and the client base are probably the main reason for this. I do like that accounting is a business function that most businesses need.

Do you want to work at a big four or is it the general field of accounting that interests you? My undergrad is not related to accounting at all but over the years I held administrative roles that exposed me to it, took some coursework at my local city college, and started working in temporary placements. After a while I found a permanent role that I really enjoy. Just another idea in case paying for a Master's degree is unappealing to you. I know I don't earn as much as if I were to have gone more formal education route, but it got me started faster, didn't require me to take on more debt, and I enjoy what I do and still earn more than what I was making before I switched careers.

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Re: How does the accounting profession fare during recessions?

Post by jlawrence01 » Tue Apr 21, 2020 3:02 am

Cpadave wrote:
Mon Apr 20, 2020 7:21 pm
The only profession I am aware that is not impacted by recession much is healthcare and k12 teaching. I am retired now, but I remember experiencing hard time finding job during recessions.
There were a lot of teachers who experienced layoffs in the Midwest in 2008-09. Many of the education graduates during that period of time found it difficult to find positions in the region that they wanted to live.

======================

To get to the OP's question, the accounting profession is affected by the recession. You will see less hiring. As for the large accounting firms, they hire a significant number of foreign nationals, even for engagements in the United States. In addition, while the accounting profession is always promoting a narrative that they like diversity in hiring, many firms do not like to hire older graduates (30+). Fortunately, large corporations don't seem to share that view.

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Re: How does the accounting profession fare during recessions?

Post by getthatmarshmallow » Thu Apr 23, 2020 2:10 pm

awg90 wrote:
Mon Apr 20, 2020 7:17 pm
I'm guessing the accounting profession does okay during recessions, would this be accurate?

I'm considering getting my master's in accounting, as my current industry goes up in flames. I have an undergrad in something not related to accounting, but I did take a course in accounting which I enjoyed.

Any insight into how hiring is for the big four etc during recessions?

Thanks!
The Big Four used to be the Big Five.

bugleheadd
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Re: How does the accounting profession fare during recessions?

Post by bugleheadd » Thu Apr 23, 2020 2:33 pm

In private accounting, there is always a push to slim down expense departments like accounting. Try to make them as lean as possible through automation, moving offshore. So layoffs are not new and are constant.There are probably layoffs in those companies that are still a bit bloated and have lost a lot of business due to coronavirus shutdowns.
I think some areas of public accounting are having layoffs too.

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Re: How does the accounting profession fare during recessions?

Post by bondsr4me » Thu Apr 23, 2020 2:37 pm

deleted.
Last edited by bondsr4me on Thu Apr 23, 2020 2:48 pm, edited 1 time in total.

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Watty
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Re: How does the accounting profession fare during recessions?

Post by Watty » Thu Apr 23, 2020 2:39 pm

How does the accounting profession fare during recessions?
Before I retired I worked in corporate IT but I worked with the our corporate accountants a lot.

In that sort of environment both IT and accountants are often viewed as being overhead and prime areas to cut when cuts need to be made.

As part of my job I also occasionally dealt with corporate payroll information and you could not help but see what other people made and some of the lower level accountants really did not make a lot. Be sure that you have realistic salary expectations about just what the entry level positions pay if you are not at a Big Four.
awg90 wrote:
Mon Apr 20, 2020 7:17 pm
Any insight into how hiring is for the big four etc during recessions?
In addition to getting a job with a Big Four you also need to be concerned about how hard it will be make progress within a Big Four during a recession since they are known for having an "up or out" career path.

https://en.wikipedia.org/wiki/Up_or_out

That could be a lot harder to do during a recession.

bondsr4me
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Re: How does the accounting profession fare during recessions?

Post by bondsr4me » Thu Apr 23, 2020 2:41 pm

getthatmarshmallow wrote:
Thu Apr 23, 2020 2:10 pm
awg90 wrote:
Mon Apr 20, 2020 7:17 pm
I'm guessing the accounting profession does okay during recessions, would this be accurate?

I'm considering getting my master's in accounting, as my current industry goes up in flames. I have an undergrad in something not related to accounting, but I did take a course in accounting which I enjoyed.

Any insight into how hiring is for the big four etc during recessions?

Thanks!
The Big Four used to be the Big Five.
And the Big Five used to be the Big Eight:
Arthur Andersen
Arthur Young
Deloitte Haskins Sells
Ernest & Whinney
Peat Marwick Mitchell
Price Waterhouse
Touche Ross
Coopers & Lybrand

dziuniek
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Re: How does the accounting profession fare during recessions?

Post by dziuniek » Thu Apr 23, 2020 2:56 pm

Way lower unemployment rate compares to the overall unemployment. Atleast in the great financial crisis.

bugleheadd
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Re: How does the accounting profession fare during recessions?

Post by bugleheadd » Thu Apr 23, 2020 3:02 pm

The key thing is to work for a recession proof company or avoid company that is just not performing well. I worked for a money losing company during these bull market years , and business units were losing money and getting consolidated. Sales, front office, operations, IT, legal, accounting/finance,HR,marketing all get chopped down.

If you hear talks about opening offices in India/phillipines/other less expensive location ; or business unit consolidations, I would be wary of the company

999
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Re: How does the accounting profession fare during recessions?

Post by 999 » Thu Apr 23, 2020 7:03 pm

Double check am the required base courses for a masters in accountancy. If you don’t have an undergrad in accounting it maybe quite a bit of prerequisites.

Overall I think the industry is stable. A lot depends on which type of company you go to.

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Re: How does the accounting profession fare during recessions?

Post by whodidntante » Thu Apr 23, 2020 7:50 pm

I would think forensic accounting is gangbusters during a recession.

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ladders11
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Re: How does the accounting profession fare during recessions?

Post by ladders11 » Fri Apr 24, 2020 12:08 am

yangtui wrote:
Mon Apr 20, 2020 8:25 pm
I think it does ok. If you are halfway decent you will probably be able to find a job in almost all economic environments. The job might be really lousy but at least it is a job. Even during good times you are not immune from corporate restructuring, cost cutting, and outsourcing. I know some very smart people with very high paying jobs that still need to find a new gig every 5 years or so. I also know of some very successful accountants that died from stress when they hit their 60s. If you are organized, detailed oriented, and efficient, then it is probably a good fit for you. If you are going to get your masters make sure you will be CPA eligible after you graduate and that the school has employers you are interested in recruiting there. Also be aware that age discrimination comes into play for a lot of roles. This is definitely true for Big 4 entry level jobs. Recruiting for Big 4 roles becomes more competitive during recessions. They always hire people but instead of hiring 20 they might only hire 2. They will also churn people faster as well to keep the talent pipeline from clogging up.

This article does a good job discussing what happened to accounting grads during the GFC.
http://retheauditors.com/2012/08/09/wai ... pa-review/
I'm going to second this post. I'd be concerned about targeting a big 4 job if you are someone already mid career in another profession going back to school. They are very specific.

You can work in accounting, just double check you're willing to work for a small regional firm and put in the apprenticeship required to get a CPA. Alternatively work in an administrative role for a company, aka management accounting.

Nothing is completely safe these days, good people are let go. Companies are sold, M and A happens, internal reorganizations, leadership changes. The only people who consider themselves essential are just not experienced enough to know any better.

Thegame14
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Re: How does the accounting profession fare during recessions?

Post by Thegame14 » Fri Apr 24, 2020 12:20 am

being a CPA and with 20 years experience, I will give you this advice. I was told that being an accountant means you will always have a job. What they dont tell you is that you will always have a shitty job where you work too many hours for too little pay, but you will have a job....

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Re: How does the accounting profession fare during recessions?

Post by AerialWombat » Fri Apr 24, 2020 12:26 am

Thegame14 wrote:
Fri Apr 24, 2020 12:20 am
being a CPA and with 20 years experience, I will give you this advice. I was told that being an accountant means you will always have a job. What they dont tell you is that you will always have a shitty job where you work too many hours for too little pay, but you will have a job....
It’s always interesting to me how people can have such different experiences within a similar range of parameters. I entered the accounting profession later in life than most, and have found it to be an amazing vehicle for creating financial and time freedom. Good ol’ YMMV.

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Re: How does the accounting profession fare during recessions?

Post by yangtui » Sat Apr 25, 2020 10:47 am

AerialWombat wrote:
Fri Apr 24, 2020 12:26 am
Thegame14 wrote:
Fri Apr 24, 2020 12:20 am
being a CPA and with 20 years experience, I will give you this advice. I was told that being an accountant means you will always have a job. What they dont tell you is that you will always have a shitty job where you work too many hours for too little pay, but you will have a job....
It’s always interesting to me how people can have such different experiences within a similar range of parameters. I entered the accounting profession later in life than most, and have found it to be an amazing vehicle for creating financial and time freedom. Good ol’ YMMV.
Accounting can be a good career path if you are willing to be creative about what you do. I started in a very generic role but built up a network that helped me pivot into a pretty exciting accounting adjacent management consulting position. After that I jumped into a low stress very secure set in stone 9 to 5 job with tremendous amounts of flexibility. Some really cool jobs exist if you look for them and get creative. I am not going to get rich doing what I do, but on an hourly basis I do extremely well and have little to no stress.

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Re: How does the accounting profession fare during recessions?

Post by yangtui » Sat Apr 25, 2020 10:50 am

ladders11 wrote:
Fri Apr 24, 2020 12:08 am
The only people who consider themselves essential are just not experienced enough to know any better.
+1

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Re: How does the accounting profession fare during recessions?

Post by cheese_breath » Sat Apr 25, 2020 12:42 pm

One would think accountants would be needed whatever the economy, and that's true. But it doesn't mean they can't be laid off. It just means the ones remaining have more work to do.
The surest way to know the future is when it becomes the past.

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Re: How does the accounting profession fare during recessions?

Post by jlawrence01 » Sat Apr 25, 2020 2:10 pm

yangtui wrote:
Sat Apr 25, 2020 10:47 am
Accounting can be a good career path if you are willing to be creative about what you do. I started in a very generic role but built up a network that helped me pivot into a pretty exciting accounting adjacent management consulting position. After that I jumped into a low stress very secure set in stone 9 to 5 job with tremendous amounts of flexibility. Some really cool jobs exist if you look for them and get creative. I am not going to get rich doing what I do, but on an hourly basis I do extremely well and have little to no stress.

I would probably agree with your post up until the last four works. The only accounting positions that are "little or no stress" are generally positions that offer little or no challenge and usually no growth. I think of several friends who work 9-5 at City Hall accounting for a municipal pension fund.

===================

As for stability of accounting positions, times like these are generally times when accounting managers implement some of the technology to reduce lower level accounting positions. In 2008-2009, I eliminated about five out of twelve position in the department. It was a good opportunity to eliminate the underperformers and those who were resistant to learning new accounting technologies.

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