The Great Exit: Why Australia’s Accounting Workforce Is Shrinking
— And What Happens Next —
Australia’s accounting workforce is shrinking. Retirement, compliance burdens, staffing shortages and shifting career paths are driving more practitioners to exit earlier than expected. At the same time, AI is reshaping roles, salary pressures remain intense, and succession opportunities are opening up. Here’s what it all means for the profession.
A Demographic Time Bomb… or a Window of Opportunity?
The Australian accounting profession is facing one of its biggest turning points in decades. Around 30% of tax agents are aged 65 or older, while fewer than one in ten are under 30. Industry estimates suggest 37% of accountants are already over 50, creating a demographic cliff that has been talked about for years — but now it’s happening.
Before COVID, forecasts suggested that nearly half of all practitioners would retire within five years. The pandemic delayed some exits, but in 2025 the “Great Exit” is underway. Older accountants are leaving in growing numbers, and younger professionals are questioning whether public practice offers the career they want.
This is more than a staffing issue — it’s a structural shift that will reshape the industry. But while disruption is real, it also creates opportunity for firms willing to adapt.
It’s Not Just the Grey Hairs Leaving
The narrative often focuses on retirement, but the exodus extends across generations. Here are some of the reasons we see are creating career uncertaintly for accountants:
Compliance is relentless. From increasingly complex tax law to ASIC reporting, firms are weighed down by regulation. In 2024, 68% of accountants told CA ANZ that unsustainable workloads were their top concern.
Audit requirements are costly. For smaller practices, the cost and paperwork of maintaining registration has led many to drop audit entirely.
Staffing shortages are biting. Vacancy fill rates for tax accountants and auditors remain below 67%, meaning firms are running lean and staff are stretched thin.
Burnout is real. Post-COVID, more practitioners are prioritising work-life balance. The grind of constant deadlines has pushed many to step away earlier than planned.
Operating costs are rising. IBISWorld reported a 7.6% increase in sector expenses in 2024, putting pressure on margins.
The message is clear: attrition is no longer just about ageing partners. It’s about systemic stressors across the profession.
Global Comparisons: Not Just an Australian Story
Australia is not alone. In the UK and US, accounting firms face similar shortages. In the US, the AICPA reported a 33% drop in new CPA candidates between 2016 and 2022. In the UK, graduate pipelines are shrinking, and firms are leaning heavily on offshore resources.
What makes Australia unique is its geographic and regulatory environment:
Distance from global talent pools makes attracting overseas staff harder.
The ATO’s regulatory framework adds layers of compliance that smaller firms struggle with.
International outsourcing is growing, with over 750 Australian firms already offshoring some compliance functions.
Globalisation means Australian firms aren’t just competing with each other — they’re competing with firms in Manila, Mumbai, and beyond.
The Money Side: Salaries Under Pressure
The supply and demand imbalance is fuelling salary growth.
Seniors and managers are seeing 10–15% pay rises.
Partners are under pressure to offer more attractive packages to retain talent.
Graduates are in short supply — accounting graduate numbers have halved since 2010 (CPA Australia, 2024).
Hybrid and remote working remain key expectations — firms that resist flexible models risk losing staff, no matter the salary.
The ABS projects that 338,000 accountants will be needed by 2026, far exceeding the pipeline. Salary pressure will remain strongest at the experienced end, while automation may flatten entry-level wages.
Workplace expectations are also shifting. 68% of professionals rate work flexibility as equally important as pay (CA ANZ, 2024). Firms that ignore hybrid work risk losing staff, no matter the salary.
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The AI Factor: Disruption or Transformation?
No force is reshaping accounting faster than artificial intelligence (AI).
On one hand, AI is a disruptor:
Routine compliance is disappearing. Tools like Xero, MYOB, and AI-driven platforms are cutting workloads by up to 30%, hollowing out the traditional entry-level roles that once trained new accountants.
Career pathways are shifting. The old apprenticeship model of reconciliations and data entry is being replaced. New accountants need skills in analysis, advisory, and client engagement from day one.
On the other hand, AI is a powerful enabler:
Advisory demand is growing. Nearly 90% of firms now report clients want more strategic advice, not just compliance (The Access Group, 2025).
Upskilling is accelerating. Around 60% of firms are investing in AI training and predictive analytics, preparing staff for higher-value roles.
Work models are evolving. Cloud-based AI tools are making hybrid and remote work seamless — a competitive edge in productivity and staff retention.
But adoption isn’t universal. Some firms hesitate, citing cost, complexity, or regulatory uncertainty. For them, the disruption feels more threatening than transformative.
The conclusion is clear: AI won’t replace accountants, but accountants using AI will replace those who don’t. For forward-looking firms, AI is not a threat — it’s the lever that will define the next decade of growth.
Diversity and Leadership: More Than a Tick Box
Another challenge the profession can’t afford to ignore is diversity in leadership. For all the progress we like to talk about, women and culturally diverse professionals are still underrepresented at partner level. That’s not just a social issue — it’s a commercial one. A narrow leadership pool means fewer options at a time when succession planning has never been more urgent.
The firms that will get ahead are those that actively build inclusive pathways — from hiring, mentorship, and leadership development — and that recognise flexibility as part of the equation. Remote and hybrid models aren’t perks anymore, they’re the baseline. Offering them doesn’t just broaden the potential leadership pipeline, it also signals to younger accountants that you’re serious about inclusion. In a market where choice is limited, culture and flexibility can be the deal-breakers.
Mental Health and Wellbeing
The attrition story cannot be told without acknowledging mental health.
46% of accounting teams report being understaffed, according to People2people (2024).
Burnout, deadline stress, and client pressure are common reasons for exits.
Firms that want to retain staff need to treat wellbeing as seriously as compliance. Initiatives like flexible hours, realistic workload management, and mental health support are no longer “nice to have” — they’re retention tools.
The ESG and Regulation Frontier
Regulation is tightening, and it’s not just about tax.
The 2023 ISSB climate disclosure standards are reshaping reporting obligations.
The ATO has stepped up scrutiny post-PwC scandal, with 80% of accountants reporting rising compliance complexity (Odyssey Resources, 2024).
ESG reporting is emerging as both a compliance burden and an advisory opportunity.
Firms that invest early in compliance expertise and ESG knowledge will be better positioned to support clients navigating this new terrain.
Is your firm prepared for partner exits? Discover why planning succession now is business-critical.
Succession Planning: The Urgency of Now
The workforce crunch is accelerating succession activity. With 37,428 accounting firms in Australia (Odyssey Resources, 2024), many are facing partner exits without clear plans.
Risks include:
Client retention drops of up to 20% in poorly managed transitions.
Cultural misalignment between buyer and seller firms.
Staff departures during ownership changes.
Some mid-sized firms are responding by promoting junior partners internally (30% according to Accountants Daily, 2024). Others are exploring mergers to build scale.
But with Professional Year enrolments falling from 7,122 in 2018 to just 340 in 2024, the pipeline of successors is shrinking fast. Waiting is no longer an option.
Why This Is Also an Opportunity
The Great Exit isn’t necessarily an obituary for the profession — it’s a catalyst for change.
Succession is creating openings for buyers.
Modernisation is driving efficiency. Cloud, AI, and automation are delivering leaner operations.
Consolidation is gaining pace. Firms that adapt quickly can grow by acquiring staff and clients.
Clients still need advice. In fact, demand for strategic, advisory-focused accountants is stronger than ever.
Strategic Recommendations
For firms wondering what to do next, here are four priorities:
Start succession planning now. Ideally 3–5 years before exit. Waiting reduces options and value.
Invest in tech and people. Allocate budget to AI tools, cloud systems, and workforce upskilling.
Embed client relationships. Regular contact, advisory services, and cultural fit are what retain clients through change.
Build flexibility into your workforce. Hybrid models, inclusive leadership, and diversity pathways are no longer optional — they’re essential for attracting and retaining the next generation of accountants.
Final Thoughts
The Australian accounting profession is at a crossroads. Retirements are accelerating, compliance is intensifying, and the talent pipeline is shrinking. At the same time, AI is unlocking productivity, client demand is steady, and succession opportunities abound.
Firms that cling to old models risk decline. Firms that modernise, plan, and embrace change will not only survive but thrive.
The Great Exit is here. The question is not whether change is coming — it’s whether your firm is ready to seize it.
If your firm is considering its next move — whether buying, selling, planning succession, or simply staying competitive — Rob Knights & Co can help. From benchmarking to valuations and succession planning, we provide the clarity and strategy to move forward with confidence.
Frequently Asked Questions
A combination of factors is driving exits: an ageing workforce, heavier compliance demands, staffing shortages, and rising costs. According to CA ANZ (2024), 68% of accountants cite unsustainable workloads, and 37% are already over 50. Vacancy fill rates for tax and audit roles remain below 67%, leaving teams stretched. Burnout and poor work-life balance are also pushing practitioners to leave earlier than planned.
AI is transforming the profession. Automation tools like Xero and MYOB are cutting routine workload by up to 30%, shrinking traditional junior pathways. But demand for advisory services is rising — 89% of firms report growth in this area. Firms are responding by upskilling staff in predictive analytics and AI integration, though resistance and adoption challenges remain, particularly in smaller firms.
Yes, particularly at senior levels. Salaries for managers and partners are under strong upward pressure due to a 50% decline in graduate numbers since 2010 and an ABS projection of 338,000 accountants needed by 2026. Entry-level roles may see slower growth as automation reduces demand. Hybrid work is now a key factor — 68% of professionals value flexibility as highly as pay.
With retirements accelerating, succession opportunities are everywhere. But due diligence is critical: client retention can drop by 20% during poorly managed transitions. Buyers must weigh culture, compliance, and staff retention as carefully as the financials. Some firms are exploring mergers or internal succession, with 30% of mid-sized firms promoting junior partners (Accountants Daily, 2024). With enrolments in the Professional Year Program collapsing from 7,122 in 2018 to 340 in 2024, planning has never been more urgent.
Future-proofing requires action on multiple fronts:
Modernisation: Cloud platforms (used by 70% of firms) and cybersecurity measures.
AI adoption: Automating compliance can reduce workloads by 25% (Sapphire Digital Accounting, 2024).
Workforce upskilling: Data analytics, AI, and cybersecurity training.
Compliance focus: ESG reporting and ATO scrutiny post-PwC scandal are top of mind.
Client relationships: Strong client contact can lift retention by 15% (NCS AU, 2025).
Regulation is tightening — from ISSB climate disclosure standards to stricter ATO oversight — and 80% of accountants say compliance complexity has risen (Odyssey Resources, 2024). At the same time, more than 750 Australian firms outsource offshore, creating global competition. Firms that specialise in niche advisory areas, leverage local market knowledge, and invest in compliance expertise will be best positioned to compete.
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