S.Korea's top four accounting firms to cut hiring 30%

South Korea's top four accounting firms -- Samil PwC, Samjong KPMG, Deloitte Anjin and EY Hanyoung -- are expected to cut hiring this year more than 30% from last year. For the first time after 2020, the number of recruits by the Big 4 is expected to fall short of that of those passing the certified public accountant (CPA) exam.

Accounting industry sources on Sunday said the four this year are expected to hire around 800 staff combined, a far cry from 1,275 last year. Samjong KPMG, which hired the most among the four last year with 390, plans to add some 350 this year.

“There is talk of the combined number of recruits at the four major accounting firms being in the upper 700 level,” a source at an accounting firm said. "This year, the atmosphere of each company is 'not bulging in size.”

The Big 4 have increased their number of new accountants over the past three years. The figure jumped 70% from 752 in 2020 to 1,275 last year during a period in which the number of hires by the four was greater than that of who passed the CPA exam each year. Under the new External Audit Act and all amendments to it in 2019, the number of auditing days surged.

A rise in M&As and corporate work beginning in 2020 also contributed to the release of huge liquidity on the market.

The situation changed in the second half of last year, however, as the number and size of M&A deals dropped sharply amid the economic downturn, reducing demand for consulting after companies closed their wallets.

The number of accountants leaving corporations also fell. Over the years, many with low seniority moved to startups, securities companies, private equity funds, venture capital and general companies, but the atmosphere has changed dramatically.

“On the M&A side, the number of people hired in 2021 and last year decreased to such an extent that it poses a burden,” a source at an accounting firm said. "There are accountants who moved to startups for high salaries but returned to accounting firms after being directly hit by the economic downturn."

The minimum number of those passing the CPA exam this year is an estimated 1,100. As the Big 4, which serve as academies for accounting, hire fewer staff, more intense competition for jobs is expected.

Those who pass the exam must undergo a two-year probationary period for practical training at places like an accounting firm to obtain professional qualifications. Most prefer the Big 4 thanks to their abundant opportunities to get prime practical experience like audits of major corporations.

Write to Han-Gyeol Seon at always@hankyung.com