If you run a CPA firm and have an open staff accountant seat that has been posted for months, you already know the problem this article is about. The work keeps arriving, the people to do it are harder to find, and the senior CPA ends up reconciling accounts at night. This piece looks at what the published data say about the US accountant pipeline, what they do not say, and how firms are using a documented offshore team in India as a capacity layer. It is a well-documented capacity pressure, not a forecast that any particular firm will fail.
- AICPA data show accounting degrees falling: 55,152 bachelor's and master's degrees in 2023-24, down 6.6% year on year. New CPA Exam candidates dropped from 42,626 (2023) to 28,082 (2024).
- BLS projects 5% growth for accountants and auditors from 2025 to 2035 and about 115,300 openings a year. Demand grows while new entrants do not.
- There are positive signs too: spring 2025 accounting enrollment rose 12.4%, so the picture is mixed, not one-way.
- UK practices report the same strain, now with Making Tax Digital for Income Tax adding quarterly work from 6 April 2026.
- An offshore team is best used for production work such as reconciliations, coding and close tasks, with your firm keeping review, signatures and advice.
- Start with a 90-day, three-close pilot on 4 to 6 clients, with the confidentiality and data controls in place first.
1. What the AICPA pipeline data show
The AICPA publishes an annual Trends report on accounting education and the CPA pipeline. Read in sequence, its figures show a shrinking inflow of new graduates over the past decade, with a recent partial recovery in enrollment.
| Measure | Figure | Source and period |
|---|---|---|
| Accounting bachelor's degrees awarded | About 47,000, down 7.8% year on year | AICPA 2023 Trends report (2021-22), via Journal of Accountancy |
| Change in accounting graduates, 2012-13 to 2021-22 | Down 16.9% | AICPA 2023 Trends report |
| Bachelor's plus master's degrees, 2023-24 | 55,152, down 6.6% | AICPA Trends data, Journal of Accountancy, 27 Oct 2025 |
| New CPA Exam candidates | 42,626 (2023); 28,082 (2024); 16,448 in the first half of 2025 | Same article |
| Accounting program enrollment, spring 2025 | 266,506 students, up 12.4%, the highest since 2020 | Same article |
| Firm hiring intent for 2025 | 75% of participating firms expected to hire at least as many new graduates as in 2024 | Same article |
Two cautions on reading this. First, the 2023 candidate figure was partly lifted by people finishing the exam before CPA Evolution launched in 2024, so the 2024 drop may overstate the underlying change. Second, the enrollment rise is real but works through the system over several years before it shows up as licensed staff. For a firm with a vacancy this quarter, the useful reading is that supply is not about to rescue the next two busy seasons.
2. What BLS projects: demand versus entrants
The Bureau of Labor Statistics adds the demand side. It does not describe a shortage in so many words. It describes steady demand with a lot of churn, which is what creates unfilled seats when entrants are thin.
| Occupation (BLS OOH, updated 2026) | 2025 jobs | Projection 2025-35 | Average openings a year | Median pay 2025 |
|---|---|---|---|---|
| Accountants and auditors | 1,595,200 | +5% (79,400 jobs) | About 115,300 | $83,680 |
| Bookkeeping, accounting and auditing clerks | 1,532,400 | -6% (85,600 fewer jobs) | About 144,100 | $50,670 |
The clerk line deserves a careful read. BLS attributes the projected decline to software that automates routine tasks. That does not remove the need for bookkeeping judgment, exception handling and close discipline, and openings still run above 144,000 a year as people leave the occupation. For a CPA firm, the practical effect is fewer trained people to hire for reconciliation and close work, even as software handles more of the keystrokes.
3. The same pressure in UK practices
UK accountancy practices describe a comparable squeeze. The figures below come from recruitment and outsourcing-industry surveys, not from a regulator, so treat them as indicators of sentiment and capacity rather than official statistics. One of the sources, Advancetrack, is itself an outsourcing provider, which is a relevant interest to keep in mind.
| Indicator | Finding | Source |
|---|---|---|
| Applicants to accountancy roles | Down 36% year on year (June 2021 to June 2022); down 33% from May to June 2022 | Broadbean Technology, reported by ICAEW, Aug 2022 |
| Firms turning away potential clients | 73% of about 500 respondents | 2026 Accounting Talent Index (Advancetrack), reported 16 Jun 2026 |
| Shortage worse than three years ago | 45% of respondents in 2026; 48% in the 2025 index, against 74% in 2024 | Advancetrack 2026 index; 2025 index as reported by ACCA's Accounting & Business magazine |
| Severe shortage in tax services | 55% (2025 index, UK and Australia, 169 businesses) | ACCA Accounting & Business magazine, Sep 2025 |
The trend in the 2025 and 2026 readings is a pressure that has eased from its 2024 peak, though it remains high. That matters because Making Tax Digital for Income Tax is adding new quarterly work. Under HMRC's rules, self-employed people and landlords with qualifying income above GBP 50,000 had to start from 6 April 2026, with GBP 30,000 from 6 April 2027 and GBP 20,000 from 6 April 2028. Quarterly updates fall due on 7 August, 7 November, 7 February and 7 May for standard quarters. Every client brought into scope means four extra submissions a year for the practice or its agents.
4. Why an offshore team fits the gap, and where it does not
The case for India rests on one thing: a deep pool of accountants who work on QuickBooks Online and Xero every day, in a time zone that lets reconciliations get done overnight in the US. That is a capacity argument, not a price one. If you cannot hire the seat locally, the choice is not between a local and an offshore accountant. It is between an offshore accountant and an unfilled seat.
It does not fit everything. Advisory, attest work, return signing and client relationships belong with your firm. Offshore capacity also needs documentation and reviewer time to work. A firm with no one available to review will not be helped by more output. Finally, a team abroad does not remove your duty under the AICPA Code to tell clients that a third-party provider may be used, or your obligations under the FTC Safeguards Rule. Our earlier articles on the CPA firm outsourcing guide and the offshore data security control map cover those rules in detail.
5. Hire locally, hire offshore, or both: a decision table
| Situation | Local hire | Offshore bench | Practical position |
|---|---|---|---|
| Seat open for 3+ months, no qualified applicants | Cannot fill | Can start after onboarding and controls | Offshore for production work; keep the seat open for a reviewer |
| Seasonal peak, Jan to Apr and Sep to Oct | Temps are scarce at peak | Capacity pod with 6 to 8 weeks of lead time | Onboard before the peak, not during it |
| Client-facing advisory growth | Needs a CPA or EA on site | Not suitable | Free local staff by moving production offshore |
| Tax-return preparation with SSN data | Preferred in year one | Only with section 7216 consent and SSN masking | Start with bookkeeping and close |
| No reviewer capacity | Hire a reviewer first | Will add more to review | Fix review capacity before scaling |
6. Worked example: closing a two-seat gap
Facts (illustrative). A 10-person CPA firm in Texas has two staff accountant seats open for five months. It serves 40 monthly bookkeeping clients on QuickBooks Online. Each client takes about 6 hours a month for reconciliations, coding and close, so 240 hours. Each staff member gives about 120 hours a month to this work, so the two missing seats are about 240 hours, which the owner and one senior now cover after hours.
Plan. Move reconciliations, coding and close checklists for 8 clients (48 hours a month) to an offshore team in a 90-day pilot. Returns and advisory stay in-house. The senior reviews each close pack against a written checklist.
| Window | Action | Output |
|---|---|---|
| Days 1 to 15 | Update the engagement letter; sign a confidentiality agreement; add the provider to the written security plan; set up named user logins with MFA | Signed documents; access list |
| Days 16 to 30 | Select 4 to 6 clean-history clients; hand over the checklist, chart of accounts notes and bank-rule logic | Client-specific SOPs |
| Days 31 to 90 | Three monthly closes; log review points by type | Review-point log; go, adjust or stop decision |
Reading the result. If the review-point count falls across the three closes and the senior's time per file drops, add 6 to 8 clients a quarter. If it does not fall, fix the SOPs before adding volume. The example shows how a capacity gap can be sized; actual hours vary by client.
7. Checklist before you start
A well-run offshore engagement should let you tick every line before live client data moves.
- You have sized the gap in hours, by client and task, and decided which tasks leave the building.
- A named reviewer has protected time each month to review close packs.
- Engagement letters tell clients a third-party service provider may be used (AICPA ET 1.150.040).
- A confidentiality agreement or MSA with the provider is signed (ET 1.700.040), covering data location, subcontracting, breach notice and exit.
- Your written information security plan covers the provider: MFA, encryption, service-provider oversight and periodic reassessment (16 CFR 314.4).
- Section 7216 consent is in place for any data that feeds a tax return; SSNs are masked.
- The provider is a registered entity. For a Chartered Accountants firm, check the ICAI firm registration number.
- A Form W-8BEN-E is on file before the first payment.
- Success measures are agreed: review points per close, turnaround days and reviewer hours per file.
8. Frequently asked questions
Is there really a CPA shortage in the United States?
The pipeline data point to a capacity squeeze rather than a collapse. AICPA's Trends data show 55,152 accounting bachelor's and master's degrees in 2023-24, down 6.6% from the prior year, and new CPA Exam candidates fell from 42,626 in 2023 to 28,082 in 2024. BLS still projects 5% growth for accountants and auditors from 2025 to 2035. Demand is growing while the supply of new entrants is flat to falling, and that gap is what firms feel.
Do the BLS numbers say bookkeeping jobs are disappearing?
BLS projects employment of bookkeeping, accounting and auditing clerks to decline 6% from 2025 to 2035, citing software automation, yet it still expects about 144,100 openings a year from turnover and exits. A firm can therefore face fewer people entering the role and a steady need to replace those who leave.
What work can an offshore team take on when we cannot hire?
Start with high-volume, rules-based work a reviewer can check against source documents: bank and card reconciliations, transaction coding, AP entry, AR application and month-end close checklists. Client advice, return signing, attest work and relationship calls stay with your firm.
Will offshoring replace the staff we already have?
It should not need to. A well-run engagement takes the production layer so your CPAs and senior staff spend their hours on review, advisory and client work. The aim is to cover vacancies you cannot fill, not to remove people you already employ.
Do UK practices face the same problem?
Recruitment-industry data suggest so. Broadbean Technology reported a 36% year-on-year fall in accountancy applicants between June 2021 and June 2022, and the 2026 Accounting Talent Index found 73% of surveyed firms turning away potential clients because of staffing. Making Tax Digital for Income Tax adds quarterly work from 6 April 2026.
What must we do before client data goes to India?
Tell clients in the engagement letter (AICPA ET 1.150.040), sign a confidentiality agreement with the provider (ET 1.700.040), cover the provider in your written information security plan under the FTC Safeguards Rule, and obtain section 7216 consent wherever tax return information is involved. Our control-map article sets this out in detail.
How long does it take to see whether an offshore bench works?
Plan on about 90 days, or three month-end closes, on a small group of clients. The first close exposes set-up gaps. The third shows whether review points are falling and turnaround is steady.
Will an offshore team certainly solve a staffing gap?
No. Results depend on scope, documentation, reviewer capacity and client mix. The data in this article describe market-wide pressure and do not predict the position of any individual firm.
9. Sources
- BLS, Occupational Outlook Handbook, Accountants and Auditors (jobs, projection and openings, 2025-35): bls.gov
- BLS, Occupational Outlook Handbook, Bookkeeping, Accounting, and Auditing Clerks: bls.gov
- AICPA 2023 Trends report, as reported in Journal of Accountancy, 12 Oct 2023: journalofaccountancy.com
- AICPA Trends data, "The accounting graduate pipeline: Where do things stand?", Journal of Accountancy, 27 Oct 2025: journalofaccountancy.com; AICPA-CIMA Trends report page: aicpa-cima.com
- ICAEW, "Decline in applicant numbers raises alarm for recruiters" (Broadbean Technology data), Aug 2022: icaew.com
- ACCA Accounting & Business magazine, "Talent shortage remains a concern" (Accounting Talent Index 2025), Sep 2025: abmagazine.accaglobal.com
- Consultancy.uk, 2026 Accounting Talent Index (Advancetrack), 16 Jun 2026: consultancy.uk
- GOV.UK, Find out if and when you need to use Making Tax Digital for Income Tax: gov.uk; Send quarterly updates: gov.uk
- FTC, Safeguards Rule: What Your Business Needs to Know (covers tax preparation firms; service-provider oversight): ftc.gov
- AICPA Code of Professional Conduct, ET 1.150.040 and 1.700.040: pub.aicpa.org/codeofconduct
Somesh Chandak & Associates, Chartered Accountants (FRN 158694W), Thane, supports accounting firms abroad with bookkeeping, reconciliations and month-end close on QuickBooks Online and Xero. We can walk through scope, workflow and the documents your firm will need before any client data moves.
Outsourced Bookkeeping for Foreign Firms Talk to usThis article is for general information for accounting professionals and is not legal, tax or data-protection advice. Survey figures reflect the cited publishers' samples and methods. Confirm your own position with counsel and your tax adviser before sharing client data with any third party.