Enrollment figures for college and university accounting programs continue to show strong interest in the profession as a new generation is graduating and entering the workforce.
Colleges and universities are now filled with members of Generation Z, the successors to the Millennials, and the number of students enrolled in bachelor’s accounting degree programs grew to a record high of 216,482 in 2015–2016, according to a new AICPA report released Wednesday. The data presented in the report for the overall number of enrollments, graduates, and hires are based on statistical projections.
But at the same time, enrollment in master’s degree accounting programs slid. The new Trends report, which describes the supply of accounting graduates and the demand for public accounting recruits, showed that the number of master’s degree enrollees fell 21% from 2014–2015 to 35,620.
The overall number of enrollees in college and university accounting programs was 253,048, virtually unchanged from the 2014–2015 report. Yvonne Hinson, CPA, CGMA, Ph.D., academic in residence and senior director for academic and student engagement for the AICPA, said in an interview that the report demonstrates a continued strong interest among students in the opportunities a career in accounting can provide.
“Enrollment is still at an all-time high,” she said. “And what we’ve really seen is a change in the mix between bachelor’s and master’s, but there are environmental factors that go into that.”
Hinson said that in the wake of the last recession, the stability related to an accounting career attracted career changers to master’s of accounting programs, increasing enrollment. With the recession increasingly distant, Hinson said the number of career changers may be shrinking. The master’s in accounting degree may have been more coveted as a differentiator for job seekers during difficult economic times, Hinson said.
The number of accounting degrees projected to be awarded in 2015–2016 demonstrated a strong supply of talent entering the workforce. The 57,119 undergraduate accounting degrees projected to be issued marked the second-highest total on record and an increase of 5% over the previous survey. The 22,405 master’s degrees projected to be awarded also represented the second-highest total ever, although they declined from the historic level reported in the previous survey.
Hiring by public accounting firms in the 2016 calendar year experienced a dropoff of 19%, however, from the previous survey. But 88% of firms said that they expected to have at least as many CPAs on staff in 2017 as in the previous year, and just 3% of firms said they expected to have fewer CPAs in 2017.
The decrease in hiring of new graduates may merely be a return to normalcy after the historic highs reported in the previous two surveys. Despite the dropoff, the 34,889 new accounting graduates hired by firms in the 2016 calendar year marks the fourth-highest total reported in the history of the survey, which dates back to 1971.
“If you look at it holistically, projected firm demand is still in alignment with the supply of accounting graduates,” Hinson said. “And we know there are lots of opportunities for accounting graduates in business and industry and not only in firms, so there continue to be many opportunities [for graduates].”
Other highlights from the report include:
- The number of new CPA Exam candidates grew 13% compared with the previous report. Hinson said this reflects candidates’ desire to take the exam before changes related to the April 2017 launch of the updated CPA Exam took effect, as well as efforts by state CPA societies, CPA firms, and the AICPA to encourage candidates to take the exam. The number of candidates who passed their fourth section of the exam increased 7%, compared with the previous survey.
- Ethnic diversity is rising among accounting students. Universities reported increases of 2 to 4 percentage points in bachelor’s and master’s accounting programs among Asian/Pacific Islander, Black/African-American, and Hispanic/Latino enrollees. The percentages of bachelor’s and master’s accounting enrollees were much higher than the portion of CPAs at accounting firms for Asian/Pacific Islanders (14% to 7%), Hispanic/Latinos (11% to 3%), and Black/African-Americans (9% to 1%).
- Auditing, with 45% of new hires, remained the most popular assignment for new hires, followed by tax (36%).
One development in the report that Hinson found encouraging was a narrowing of the gap between the numbers of accounting graduates and first-time CPA Exam takers. There were 48,004 new exam takers in 2016, compared with 42,653 in 2015 and 41,266 in 2014. With the overall number of accounting graduates remaining flat over that period, this number may indicate a greater understanding among new entrants in the workforce about the value of the CPA credential.
“While the hiring of new accounting graduates has slowed after historic heights in the previous four years, we still have a lot of opportunities for accounting graduates,” Hinson said. “And we’re of course excited to see the narrowing of the gap with the CPA Exam.”
—Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is a JofA editorial director.