USA Tax Market
As we navigate the tail-end of the great resignation and cooling of the jobs market in Q1, we are faced with a range of challenges, from Federal Reserve monetary policy to tepid investor outlook, sector-specific layoffs, and high-profile banking collapses.
Yet, despite these obstacles, job growth remains robust, and employment levels are at 15-year highs. This complex environment creates unique opportunities and challenges for American corporations, who remain resolute in their quest to hire the best talent.
In addition, demands for workplace equity, and new pay transparency laws in major cities like New York, have kept salaried employment offers high. Finally, 2022 was the year when hybrid working (make no mistake – this is driven by workers, not bosses) was solidified in some variation into the workweek.
Within the tax market, an ongoing congressional stalemate is putting US treasury policy out of step with new OECD rules, creating threats and opportunities for Tax Leaders in domestic and internationally headquartered companies. As a result, there is an ever-heightened need for skilled tax accountants or external advisors that can navigate an unsettled global tax policy landscape to find tax incentives and mitigate risk. The real-world driver of salary growth within tax isn't necessarily tenure or experience but what problems candidates can solve and the certainty they can provide.
Compared to past editions of our US Tax Salary Guide, you will see that the bandings have shifted dramatically - not only is there a collective 'up' with inflation, but there's a blurring of the bandings among the 'do-er classes' at Junior and Senior Manager levels, across all disciplines.
HR departments have worked harder to attract and retain individual contributors, with banding-breaking salaries and elevated titles offered to those that can resolve tricky accounting problems or close a financial year-end. To put it simply, experienced Seniors and Tax Managers hold the cards. As employees, they're the strongest drivers and beneficiaries of flexible working arrangements and have seen their salaries accelerate YoY. As candidates, they see the largest volume of job opportunities and will have the least competition from their peers during the interview stage. Unfortunately for talent teams, they're also the hardest to attract.
Meanwhile, higher interest rates and a tepid M&A landscape has caused tax departments to shift from due diligence towards integration projects as levered companies look to maximize their recent investments. Whilst it may seem counterintuitive in an age of legislative uncertainty (what's new?), this has put downward pressure on the salaries and opportunities of tax lawyers. Similarly, poor stock performance, typically a significant component of a US Tax Leaders package, has lowered the overall compensation expectations at the Director level and above.
As always, within the US, every city has a tale, with different regions and markets following their own trends.
Should you require further information, please contact the team for a more detailed and personalized discussion. Our seasoned professionals are always ready to provide customized solutions that align with your unique requirements and objectives.
Outlook for 2023
I will not touch on macroeconomics as any concrete predictions would be foolish. However, companies will crystallize their positions on remote working, perhaps splitting the job market into those who have offices and those who do not. Remote candidates who move to low-cost areas may compete for fewer jobs and, as a result, may see their salary bargaining power reduced. Overall, US tax will become more complicated and time-consuming; therefore, salaries will remain stubbornly high.
Alex Johns
Director Tax +1 917 628 5382 alexjohns@puresearch.com