Many public accounting firms are continuing to focus on hiring, yet many report little improvement in staffing stability. Headcounts fluctuate, recruiting pipelines stay active and turnover remains higher than the firm would like.
IPA data shows that this pattern is not temporary. Turnover has become a structural feature of the profession, particularly at the experienced staff and manager levels. These departures carry an outsized impact, as they occur after firms have already invested significant time and resources into training and development.
The financial implications are substantial. Replacement costs, including recruiting, onboarding, lost productivity and leadership time, exceed the cost of retaining existing employees. Despite this, many firms continue to prioritize hiring volume over retention strategy, treating turnover as an unavoidable cost of doing business rather than a manageable risk.
Compensation is frequently cited as the primary driver of departures, but IPA data suggests a more complex reality. While pay remains important, younger professionals consistently point to workload sustainability, career clarity, transparency, flexibility and leadership support as equally influential factors. Firms that focus solely on compensation adjustments often fail to address the underlying issues that drive disengagement.
Retention challenges also tend to surface first in productivity metrics. Firms experiencing higher turnover frequently report lower revenue per FTE, increased rework and heavier burdens on remaining staff. Over time, this creates a cycle in which retention problems fuel operational strain, further increasing the likelihood of additional departures.
The data indicates that retention is no longer just an HR issue. It is a leadership and operating model issue. Firms that treat retention as a strategic priority, supported by clear expectations, sustainable workloads and intentional development paths, are better positioned to stabilize their workforce.
As labor markets normalize, recruiting alone will not be enough to sustain performance. Firms that fail to address retention risk may find themselves permanently operating below capacity, regardless of how strong demand remains.
