Small-tier accountancy firms facing worst talent crisis in years
Small to mid-tier accountancy firms are facing “serious” barriers to growth due to staffing shortages, according to a damning new report into the sector.
According to figures from outsourcing specialists Advancetrack, 94 per cent of firms say recruitment issues are now holding back growth, forcing them to outsource work overseas.
These figures represent an increase from last year’s report, which found that just under half of the accounting firms surveyed identified a skills crisis as a problem.
The 2025 Accounting Talent Index, which surveyed nearly 170 representatives predominantly from the UK and Australia, revealed that a further 74 per cent of respondents cited the recruitment crisis as preventing them from taking on more clients.
As a result, over two-thirds of those firms have said they are now outsourcing work overseas to expand their resource base, with a further 33 per cent offshoring.
Vipul Sheth, managing director of Advancetrack, stated, “We’re seeing record numbers of firms turning to outsourcing, offshoring, and tech investment, not just as a cost-saving measure, but as the only realistic route to sustainable growth in the current climate”.
Rising salaries put pressure on accountancy firms
Nearly half of these surveys reported facing rising salary pressures. The report quoted the Austin Rose Salary Survey 2025, which stated that the majority of firms are offering more modest pay increases this year, ranging from one per cent to four per cent, to account for inflation.
As a result, nearly 40 per cent said they are investing in tech upgrades and staff development to future-proof their business.
“We’re seeing a step-change where leaders must rethink how they deliver services, not just who delivers them. That means being smarter about structure, tech and global resourcing. Those who move early and adapt fastest will be the ones that thrive,” Sheth added.
This comes after a report in June revealed that a majority of Gen-Z accountancy students now aspire to start their own business rather than climb up the traditional ranks of a firm.
The sector is undergoing significant changes after a surge of interest from private equity houses was noted to be at an all-time high, with data in July revealing a strong appetite for “a major injection of funds” on both sides.