'Precious Professionals': 15,000 Candidates Flock to Accountant Exam

[Asia Economy Reporter Park Jihwan] This year, more than 15,000 candidates applied for the first stage of the Korean Certified Public Accountant (CPA) exam, marking the highest number of applicants in 20 years. The demand for accountants has surged sharply due to the introduction of the new External Audit Act in 2018, among other factors. While the salary, an important criterion for career choice, has significantly increased, the work-life balance (WLB) has also improved, which is believed to have influenced this trend. The prolonged COVID-19 situation for over two years, which has negatively impacted the new hiring market for companies, also appears to have played a role.

According to the Financial Supervisory Service on the 20th, the number of applicants for the 57th CPA first exam scheduled for the 9th of next month was counted at 15,413, a 14.5% increase from last year's 13,458. The competition ratio for the first exam, which selects about 2,200 candidates, is 7.01 to 1. Last year, it was 6.12 to 1.

The number of first-stage CPA exam applicants was only 9,677 three years ago in 2019, but surged after the enforcement of the new External Audit Act in November 2018. The number of applicants increased by 10-20% annually, with 10,874 in 2020 and 13,458 in 2021. The current number of about 15,000 applicants is the fourth highest ever, following 17,112 in 1999, 16,014 in 2000, and 15,460 in 2002.

Recently, with the strengthening of the external audit system, not only accounting firms but also public institutions and companies have increased their demand for accounting professionals. As a result, accountants' incomes have risen significantly, while the workload has decreased due to the establishment of the 52-hour workweek, among other factors, which seems to have collectively influenced this trend.

◇ Six-year assistant manager experience with a basic annual salary in the billion-won range = Recently, the value of accountants has skyrocketed. Three years ago in 2018, a first-year manager at a large accounting firm with six years of experience had a basic annual salary in the mid-80 million won range, but now, no matter where they go, the basic salary is guaranteed to be at least 100 million won. Excluding bonuses, it is generally accepted that they take home a monthly salary of over 6 million won after tax. Including bonuses, the annual salary is reported to reach about 120 to 130 million won.

Moreover, the annual salary of entry-level accountants, who are new to the profession, also exceeds 60 million won. In particular, from December for 3 to 4 months, ‘short-term audit part-time jobs’ targeting retired accountants or those on leave due to studies or childcare offer monthly compensation of up to 10 million won for those with 5 to 6 years of practical experience who can be immediately deployed. This is equivalent to earning 30 to 40 million won, the annual salary level of a small or medium-sized enterprise employee, in a short period.

◇ Worst youth unemployment in a decade also plays a role = The prolonged COVID-19 pandemic for over two years has worsened youth unemployment, which is also cited as a reason for the increase in CPA exam applicants. When the economy is poor, there is a tendency for more candidates to take professional qualification exams. According to the ‘2020 Higher Education Graduate Employment Statistics Survey’ released by the Ministry of Education and the Korea Educational Development Institute, the employment rate for college graduates and above in 2020 was 65.1%, the lowest since the survey began in 2011. An industry insider said, "Due to the poor hiring situation of companies amid the recent COVID-19 situation, there seems to be a movement to ‘avoid the storm for now’ by applying for certification exams." In fact, past cases show that the highest number of applicants for the CPA first exam was in 1999, during the height of the International Monetary Fund (IMF) bailout, with 17,112 applicants. The number of applicants surged by nearly 5,000 in a short period from 12,122 in 1996, 12,332 in 1997, and 14,546 in 1998.

There is also analysis that the number of applicants aiming for a last-chance effect has increased in anticipation of a possible reduction in the number of CPA exam selections depending on market conditions. The minimum number of CPA selections is currently 1,100 until this year, marking the highest level for three consecutive years. The minimum number of CPA selections increased from 850 in 2018 to 1,000 in 2019, and has been maintained at 1,100 from 2020 to 2022. However, the CPA Qualification System Deliberation Committee, which decides the number of CPA exam selections, has indicated that the number of selections may decrease after this year. The accounting industry also holds the view that since the number of selections increased by more than 30% in a short period after the introduction of the new External Audit Act, the supply and demand of accountants should be adjusted from a long-term perspective. One of the key pledges of Kim Young-sik, president of the Korean Institute of Certified Public Accountants who took office in 2020, was also to reduce the number of selections.