We have noticed several trends in hiring tax professionals we want to share with you. There is a lot of opportunity for tax professionals as the demand is very high. For the purpose of this post, I want to address three areas of importance to any organization hiring a tax professional or any tax professional looking today.
What I will cover is high demand for tax professionals and the low number of tax professionals available; why companies are experiencing delays in finding the highly technical talent they need; and why compensation is an issue in attracting technically trained tax professionals.
The high demand for tax professionals today is largely a result of the Tax Cuts And Jobs Act turning the tax world upside down. The rules of engagement have changed while everyone is feeling their way around new tax rules, tax regulations and tax technology.
It is overwhelming for any tax professional keeping up with all the changes in order to comply with these new tax rules. On top of all of these changes, organizations have the expectation for tax professionals to learn the new technology that is being implemented or thinking about being implemented. There is so much change coming at tax professionals today and it is coming at a fast pace.
Recently, we conducted a survey of around 3000 tax executives and discovered interesting trends. The majority of corporate tax organizations around the country are challenged keeping up with the changing tax regulations, keeping up with all the new technology, and finding international and state and local tax expertise for their organizations. Add all of the state and local tax issues surrounding nexus and the international and we have a storm of issues to be addressed in the states and internationally. The demand is high for international and state and local tax expertise and will continue to be so for some time now.
The next issue is “why are companies facing delays in finding trained and technically qualified talent they need in their tax organizations?” As an example, throughout the Midwest region right now corporate tax executives are experiencing a very challenging time finding tax staff to tax senior level candidates for all the open roles in their organizations. The competition is fierce for this talent all over the country. I know this for a fact having spoken to so many corporate tax executives recently.
Here is what I am telling corporate tax executives. Many of these Midwest region organizations have tax teams who have been loyal and with them for a very long time. When they go out to hire they are discovering that the public accounting firms are compensating 3-5 year tax professionals a lot more than they may be compensating their current loyal in-house tax managers. This is creating a huge problem for any lead tax executive who wants to take care of the people who have been loyal and yet at the same time they are interviewing tax candidates out of the firms making as much as their tax managers. It is called compensation compression and it is what companies are faced with if they want to hire technically trained tax professionals today. It is a frustrating time for corporate tax executives as many of these company human resource organizations are taking more time to address the reality. I advise every tax director who consults with me to give their tax team a raise or lose them to companies offering more money.
The reason compensation is an issue is that human resource leaders work with top management and have a certain pay level they want to compensate their employees. What I advise human resource representatives I speak to is that they must not compensate tax professionals the same as accounting professionals. There is a world of difference in their highly technical training. I understand compensation trends as a known leading expert in the tax search profession and how to compensate them.
What we do for our clients who retain us is provide an analysis of compensation trends throughput the search process. It is a time consuming process but ensures the corporations who are hiring tax professionals today get it right the first time around. The companies who are making mistakes in compensating their tax teams are waiting over one year to find the tax professionals they need.
Have a need for a tax professional? Contact Kat Jennings.