The accountancy sector is one of the few that can gain some benefits from a bad economic situation, as part of the role is picking up the pieces in areas like insolvency when firms fall victim to the effects of a downturn.
Extra work in areas like this can mean more accountancy recruitment, which may sound crudely opportunistic, but is after all a situation not made by the accountants, any more than busy doctors can be blamed for the onset of an epidemic. Indeed, much of the work of accountancy firms will not be in insolvency, but helping struggling clients to keep going.
The latest economic figures continue to make grim reading. Consumer Price Index inflation in March remained over ten per cent, albeit slightly down on the 10.4 per cent recorded for February. This may prompt further base rate rises, hitting indebted businesses and their customers harder.
Gross Domestic Product figures for the first quarter are still awaited (they will be released on May 12th), but they were just 0.1 per cent in the last three months of 2022.
All this suggests the words of an article by Accountancy Age last month are as relevant now as then. True, the UK looks set to avoid a recession, but not by much, while inflation is more persistent than expected.
What the article noted was that there are clear opportunities for growth, because clients will be increasingly reliant on the skills of their accountants to help them navigate periods of financial struggle. This will not just create more demand for work, but also help strengthen client relationships.
This also means that when economic conditions do improve, the firms that emerge with renewed strength, greater efficiency and strong plans for the future will do so, happy to acknowledge the support good accountancy firms gave them. This may make them willing customers for further services in future expansions, ensuring accountancy firms gain from the good times too.