Why Do People Say Accounting is Recession Proof? And is it?

[kyphysics]

Very curious.

Is there a supply and demand imbalance?

When there is a recession and businesses are stagnant and new ones aren't starting up, how do accountants still get good work?

 

[The Bill]

I feel like your question is incomplete. Are you asking if accounting is recession-proof?

 

[Hornbein]

Very curious.

Is there a supply and demand imbalance?

When there is a recession and businesses are stagnant and new ones aren't starting up, how do accountants still get good work?

Companies need accounting. Profit/loss makes no difference.

 

[chiro]

Hey kyphysics.

There are legal requirements for businesses to do accounting related tasks and this is independent (in many ways) of the economics of markets and nation states.

This requirement drives the needs for many accounting functions - and the businesses/organizations that provide them.

 

[Kerrie]

All businesses need accounting functions, whether they are successful or not. It is the language of business.

 

[StatGuy2000]

Hey kyphysics.

There are legal requirements for businesses to do accounting related tasks and this is independent (in many ways) of the economics of markets and nation states.

This requirement drives the needs for many accounting functions - and the businesses/organizations that provide them.

To kyphysics:

What chiro stated above is essentially correct -- accounting requirements are based on legal requirements for businesses (e.g. tax, reporting of profit/loss, etc.) which would drive the needs of the many accounting functions.

That being said, businesses/organizations that provide such services are not immune to prevailing economic situation, and may increase or decrease hiring (or even lay off) staff depending on the level of demand of said services for a organization, or the profitability of said organization. So accounting is not entirely "recession-proof" in that sense (my suspicion was that during the 2008 global economic crisis, hiring for new graduates in accounting programs would have plummeted or frozen out completely, and there would likely have been layoffs at major accounting firms).