This article is part of a larger series on Accounting Software.
Accounting is a $110 billion industry in the United States. In addition to providing great career opportunities, accounting firms provide small businesses with much-needed support, such as financial audits and tax compliance services. Accounting firms also stepped up in a major way during the COVID-19 pandemic, with almost 80% of firms providing COVID-19-related consulting services.
To understand the state of the accounting industry better, we’ve compiled the most relevant accounting statistics around accounting software, accounting jobs, accounting industry trends, and small business accounting.
General Accounting Statistics
1. 85% of accounting and finance professionals worked in-office prior to the pandemic
This percentage dropped to only 22% at the peak of the pandemic and is expected to return to 47% in 2022.
2. 66% of accounting firm staff worked in the office full-time in 2022
In 2022, staff at accounting firms are much more likely to work in the office than other accounting and finance professionals. This high reliance on in-office employees could be driven by the necessity for auditors to be present physically at the client’s premises to perform an audit.
3. 72,923 students completed a bachelor’s or master’s degree in accounting in 2019-2020
According to the 2021 AICPA Trends Report, the number of accounting graduates saw a decline in 2019-2020 compared to the previous five years, which was anywhere from 76,000 to 79,000.
4. 1.3 million accountants and auditors are employed in the US
This number is split fairly evenly between certified public accountants (CPAs) and non-CPAs, with 669,130 actively licensed CPAs as of August 2021. There are relatively few enrolled agents (EAs), which are tax professionals licensed directly by the IRS to represent taxpayers.
Accounting Job Statistics
5. $58,178: Average base salary for an accountant in the US
The base salary for accountants in the US varies slightly by the level of education. An accountant with a graduate degree makes only 4% more, on average, than an accountant with an associate degree.
6. $70,838: Average salary for CPAs
On average, CPAs earn about $7,000 more per year than corporate accountants or office managers.
7. 151,320 accountants and auditors were in California in 2021
As of May 2021, California has the highest number of accountants and auditors among all states in the US. New York has the next-highest number of accountants, with 111,660, followed by Texas, with 104,490.
(US Bureau of Labor Statistics)
Accounting Software Statistics
8. 64% of business owners do their own bookkeeping
Cloud-based small business accounting software that can transfer transactions automatically from bank accounts has taken much of the time-consuming work out of bookkeeping.
(Statista: Software Usage)
9. 5.5 million QuickBooks Online subscribers worldwide
QuickBooks Online holds a 62% share of the global small business accounting software market, with the majority of its subscribers being in the US.
10. 2.3 million Xero subscribers worldwide
Xero is the second largest provider of small business accounting software in the world but is more prevalent outside of the US than within the US.
(Xero Limited FY20 Annual Report)
Are you interested in learning more about popular accounting solutions? Check out our article on the best small business accounting software.
Accounting Industry Statistics
11. $110 billion: US accounting industry revenue in 2020
More than 50% of the US revenue ($66 billion) was generated by the four largest accounting firms.
12. $157 billion: 2020 Global revenue of the four largest accounting firms
Deloitte is the largest accounting firm in the world with more than $47 billion in annual revenues.
13. 10 to 15 years: Average time it takes for an employee to become a partner in accounting firms of all types
Smaller firms can often provide a quicker path to becoming a partner.
(Journal of Accountancy: Path to Partner)
Accounting Services Trends
14. 30% of revenue is earned by US firms for auditing services
Tax preparation, planning, and consulting services are another 36.1% of revenue. While US accounting firms are continually looking for opportunities to expand services, traditional auditing and tax services still provide the overwhelming majority of their revenue.
(IBISWorld Industry Report)
15. 79% of accounting firms offered COVID-19-related consulting services in 2021
This is very widespread, considering that only 58% of firms offer client accounting (bookkeeping) services. Accounting firms have played a key role in helping clients receive their COVID-19 relief.
16. 51% of accountants cite keeping up with regulatory change as their biggest issue
Other major issues facing accounting firms include finding and keeping good employees and clients.
- Keeping up with regulatory change: 51%
- Recruiting/retaining good employees: 35%
- Acquiring and retaining new clients: 26%
- Keeping up with technology: 24%
- The overall economy: 19%
- Economic health of clients: 18%
Small Business Accounting Statistics
17. 31% of small businesses in the US spend more than $5,000 per year administering their federal taxes
Only 15% of small businesses report spending more than $10,000 administering federal taxes.
18. 27.8 million small businesses filed taxes as sole proprietors in 2019
Sole proprietors are the most common type of business in the US and must file an annual Schedule C. Schedule C is a relatively simple income statement for nonincorporated, single-owner businesses to file with their personal income tax return, Form 1040.
(IRS SOI Tax Stats)
19. $58,847: Average gross revenue reported on Schedule C in 2019
The average expenses reported were $46,179, for an average net income of $12,768.
(IRS SOI Tax Stats)
20. $5,175: Average wages paid by Schedule C businesses in 2019
Schedule C businesses cannot pay wages to owners, so any wages paid are to nonowner employees. The fact that wages paid by Schedule C businesses are so low is consistent with most small businesses forming a corporation or limited liability company (LLC) if they have employees.
(IRS SOI Tax Stats)
21. 4.7 million S corporations filed tax returns in 2017
Most S-corporations (S-corps) are fairly small, with 4.3 million (91.5%) having total assets of less than $1 million.
(IRS SOI Tax Stats)
22. $1.7 million: Average gross revenue reported by S-corps in 2017
S-corps in 2017 also reported average expenses of $1.5 million for an average net income of $101,572. Only $62,000 of the $1.5 million in average expenses were paid to the shareholder officers as salaries.
Accounts Payable & Automation Statistics
23. 58% of finance professionals believe that COVID-19 was a catalyst for moving from paper to digital processes
COVID-19 forced many employees to work remotely which, in turn, required many traditionally paper tasks to become digital. Common digitized tasks include invoicing customers and processing check payments to vendors.
24. 29% of companies with less than $250 million in revenue implemented an automated accounts payable process.
More than 48% of larger companies have made the switch to an automated accounts payable (A/P) process, but smaller companies seem more reluctant to adopt the new technology.
25. 45% of businesses make the majority of their payments with a paper check
Automated clearing house (ACH) payments are leading the way as the growing alternative to paper checks, with 50% of companies reporting an increase in ACH payments from 2020 to 2021.
We hope these statistics have provided you with insights into the importance of accounting in the US economy, particularly as it relates to our workforce of young professionals and small businesses.
References: MineralTree, Accounting Today (1) (2), AICPA 2021 Trends Report, US Bureau of Labor Statistics, NASBA, NAEA, Surgent, Indeed, Salary.com, Zipia.com, Zipia.com, Statista: Employment by State, Statista: Software Usage, ZDNet, Xero Limited FY20 Annual Report, Statista: Accounting Industry, Statista: U.S. Firms, Statista: Big Four Firms, Journal of Accountancy: Path to Partner, IBISWorld Industry Report, PR Newswire: SCORE, IRS SOI Tax Stats