Where's the intern?
Besides being a common question asked around the office, there has been a rising question as to why the incoming cohorts of interns and new hires are shrinking.
Accounting students of high caliber are increasingly in high demand, yet there seems to be a shrinking supply from the universities. Is this a reflection of how students view the profession? Or is it a symptom of the post-pandemic world and a failure of the industry to keep up with the times?
What is it that the new wave of workers are looking for in the job market? That which once compelled the employee in the "old normal" is hardly what will entice new talent to come join your team. Or is it?
In a study conducted at 19 universities across the country, undergraduate and graduate business students were asked what they look for in internship and in the companies and firms they consider signing on to for their first "real adult job." Growth and flexibility were the most common answers, followed closely by pay.
More specifically though, what are they looking for?
With these broad-brush strokes of demands, it is best to break down the top deal breakers when it comes to the negotiation table.
Growth
Growth was listed by close to 30% of participants as a major contributor to their job choice. This new generation is ambitious and eager to please those whom they are hired by. However, they quickly realize when there is no growth potential in their new environment; they quickly adopt the mindset that jumping ship to a new employer is a more attractive option for career growth, and a faster option than waiting for the current management to take its natural course of being phased out. According to a study done by Pew Research Center, 63% of participants listed that the reason they left was because of a lack of opportunities to advance at their current employer.
The accompany graph illustrates how participants responded to the question if they can see themselves staying at a single job for different periods of time. Asking for a five-year commitment seems to be a no-brainer, however one in five employees plans on changing jobs before the 10-year mark, and just under 50% of team members plan on jumping ship before the 15-year mark hits. Employee turnover is an expensive reality for many companies, reducing the number of employees lost due to preventable turnover should be just as much a priority as bringing in new talent.
New hires and interns alike will make their first impressions of the work environment in the first two weeks of being on the job. This primary impression will either carry them through the rough and tumble of the growing pains or will be the beginning of a festering infection within your ranks. Honest and transparent presentation of expectations to new hires is a strong motivator to stick it out. This in contrast to companies putting up a facade for two weeks and then slipping into a different reality once the honeymoon phase is over. Candidness promotes growth; fraudulent showmanship breads contempt.
Flexibility
Work hour flexibility was listed as the No. 1 requirement for nearly 25% of participants looking for a new role. It is no wonder that the hybrid work option is often a question that candidates bring up in interviews. A Stanford research study found that 79.2% of employees would like at least one work-from-home day, with 31.7% asking to work entirely remotely.
Students pursuing their masters are looking for jobs willing to accommodate their class schedules. Those who are starting families are looking for more time at home to help with the young children. The young and ambitious professional who has no ties, however, may be looking to get more hours beyond the standard eight-hour day. These are all factors that companies must start considering as the new workforce starts moving.
Compensation
There is a reason that compensation is often the one that can be seen having the most direct correlation in talent acquisition. When asked how much of a raise would persuade employees to change their current employers, 21% of participants said that a $5,000 raise would be enough to persuade them, 62% said that $10,000 would be enough, 79% caving in at $15,000, and only 7% stating that not even a $20,000 raise would be enough to persuade them to change jobs.
The United States saw pay increase by 15% during 2021, which has slowed down to only a 5% increase in growth so far in 2023. As time continues, it will be up to the market to determine what the price will be for labor. However, the top talent will always demand the highest price, and attracting this talent will require corresponding compensation.
A group of accounting students at the University of Memphis were asked to report their hourly compensation from their internships from the Fall of 2022 to the Summer of 2023. They held positions ranging from tax preparation and tax compliance to accounts receivables, all relating to their common major in accounting. Those working at CPA firms had higher average earnings, and it was evident that at some of the larger firms, those whose internship positions were related to tax preparation held the highest compensation rate. While this is a cliché fact, the retention rate says otherwise.
Students were asked in a follow-up survey if an increase in hourly compensation would persuade them to accept employment after their internship. A student who interned at a firm that was among the top 20% in terms of what it paid interns stated, "An additional amount could not have persuaded me to stay." Another commented, "Nothing could have persuaded me to stay due to the hours I was asked to work."
This establishes one idea: Higher compensation may not convince an intern to stay. However, how much higher must one bid to convince the hot talent to jump sides and join your company? Taking the same data from before, we can reverse-engineer an answer.
It can be inferred that 60% of the talent pool is willing to switch sides as soon as you can offer an increase of $10,000 over their current employer. Thus, should there be a candidate that you are desperate to get in your firm's line-up, there are some raises that even the most loyal of employees are willing to swoon for.
Work life-balance
When asked to rank a compilation of attributes in order of their prevalence in selection for job choice, work-life balance was selected as the first-choice 30% of the time. After hearing the tales of horrors of long hours and the inability to focus on more than just the office, newcomers to the workforce are on the defense regarding this possibility and wish to safeguard against it.
Work-life balance is a reality that has been a saving grace to many professionals' nerves, careers, and more than a few marriages.
However, is this something that the industry should be actively seeking to accommodate? There is a common economic model that those in the professional services sector build their firm around: the infamous billable hour.
James Pagliaro, in a lecture at the University of Virginia Law School, spoke about this reality: "How do [professional services firms] make the most profit in the world? To work you as hard as they can work you, that is a fact of life!"
To which he implored the students (potential lawyers, in this case) to wholeheartedly "Accept it!" This is the advice that interns and new hires march to as they deploy into the cubical farms and tax trenches of CPA firms. This crucible of the billable hours has a remarkable tempering effect on young professionals and should not be completely demonized. However, it must also be said that not all who emerge from it are looking to turn around and charge headfirst into it again.
Offering different arrival and departure times for employees allows them to fit the workday into their schedule; flex hours have become an increasingly attractive option for workers. Options do not have to be many to attract new talent, but options themselves must be offered.
Conclusion
There are several additional factors that lead to attracting and retaining talent; it is of the utmost importance, however, that employers never lose touch with the incoming workforce. Their likes, dislikes, and even their quirks are often the key to a company's success. So, the next time you see an intern at the coffeepot, it may serve you well to strike up a conversation about more than just the weather.
