Dive Brief:

• Demand for interim financial leadership skyrocketed last year, with requests for interim CFOs jumping by 46%, according to a report by Business Talent Group, a Heidrick & Struggles company.  
• As well as interim CFO leadership, requests for on-demand talent with skills in key areas of finance also jumped; requests for talent that’s skilled in audit, accounting and financial controls have increased 33%, while those for FP&A and modeling skills increased 28%, the report found.
• The rise in demand for audit, accounting and similar skills is “a logical consequence of the declining pipeline of accounting majors and CPA candidates,” Jack Castonguay, an assistant professor of accounting at New York’s Hofstra University, said in an email.

Dive Insight:

Competition to nab skilled accounting talent has only become fiercer in recent years amid a worsening shortage of accounting professionals, leaving companies with critical gaps in their financial leadership and function. In addition to surging demand for interim CFOs, requests for senior vice president or vice president-level financial professionals — such as controllers and the heads of financial planning & analysis — rose by 114%, according to BTG.

When it comes to roles such as the head of FP&A or controllers, for example, “I think as you have shortages on one end, you're going to have demand with organizations, whether it be full time or on-demand, for talent coming in,” Sunny Ackerman, global managing partner for on-demand talent at Heidrick & Struggles said in an interview. Ackerman does believe there is a link between the shortage in talent and the spike in requests for on-demand employees in these areas, she said. “So I think there is definitely a correlation for that.”

Historically, many companies have looked to fill roles in FP&A, audit, financial reporting and up to the CFO or controller chair with employees that have previously worked for an accounting firm, but dynamics have changed in recent years where many roles in accounting are now outsourced, Castonguay said.

“With accounting firm dynamics, largely insufficient salaries and work-life balance leaving firms struggling to attract people to the profession, the companies needing these people are now logically also struggling,” he said in an email. “You cannot disconnect the two.”

The narrower pipeline of new accounting graduates plus a high rate of retirement in the industry can leave the employees that are left overworked, increasing the likelihood of mistakes, according to a report by Fortune. “Significant attrition” in the accounting department for retail brand Tupperware contributed to a delay in the company’s ability to file its annual 10-K form on time with the Securities and Exchange Commission, for example, the second consecutive year the brand will be filing late.  

“Fewer grads lead to fewer public accountants which leads to fewer qualified and experienced hires for companies to place in their internal accounting-focused roles,” Castonguay said. “The dynamic makes me wonder how the temporary or outsourced staffing firms are finding candidates at their staffing firms. It’s possible that will be the next shoe to drop.”

On the labor side, changing ways of working may also be impacting how employees want to work; while there may be shortages in certain areas, the company is not necessarily seeing a slowdown of new candidates joining their platform, Ackerman said. 

“So I think, even though there's shortages in certain areas, I think talent is looking at this way of working differently than they did five years ago, and more companies are engaging with it,” she said. 

Companies may also be more motivated to try out on-demand talent as they look to plug critical skill gaps in their workforces. Ninety-five percent of executives said they anticipate difficulty finding the “ideal combination of skills, capacity and expertise” inside their teams, BTG’s report said. Today’s companies “now are starting to really open up and look at how they can blend full time talent with more independent talent and tapping into those capabilities at the desired time,” Ackerman said.

That includes how they might be approaching interim leadership; many firms are looking for on-demand talent to help provide critical support for larger-scale projects or initiatives, according to BTG, a category that makes up 27% of all talent requests. Interim leadership can provide benefits to companies who are in transition or who are undertaking major changes, according to a 2023 CFO Dive report citing BTG data from that year.

An interim controller, for example, could take point on business process optimization for the business to successfully execute such a project; “the CFO or that finance function is quite a bit of a right hand, I would say to the executive suite,” Ackerman said.