Deregulation push puts KPMG’s CPA talent pipeline under pressure

State lawmakers are taking aim at CPA licensure just as accounting firms are still trying to rebuild their talent pipeline, putting pressure on the credential that underpins a big share of KPMG’s audit and tax work.

James Cox, the AICPA’s vice president of State Advocacy & State Society Relations and executive director of ARPL, said on a May 21 discussion that deregulation is gaining traction in state legislatures, helped by budget pressure and broader political trends. The worry inside the profession is not only that fewer rules could widen the entry point into accounting, but that weaker licensing standards could also erode trust in financial reporting and other professional services.

That matters inside KPMG because the CPA is more than a résumé line. It is part of how the firm recruits new graduates, justifies the grind of exam prep, and builds a path from staff to manager to partner. If candidates start to see licensure as optional or interchangeable, firms will have a harder time persuading them to take on the long hours and exam pressure that still define early-career accounting.

The debate is happening while the profession is already trying to modernize its entry rules. On May 14, 2025, the AICPA and NASBA approved an additional CPA licensure path based on a bachelor’s degree, two years of experience and passing the CPA Exam, along with safe-harbor language for CPAs licensed under earlier requirements as of Dec. 31, 2024. The AICPA said 14 states had adopted the new pathway at the time, a sign that licensure reform is already reshaping state law rather than living in the abstract.

The labor numbers show why the policy fight is so consequential. AICPA’s 2025 Trends report said public accounting firms hired 11,985 new graduates in 2024, and 75% of them were accounting graduates. But the supply of degrees has been falling: accounting bachelor’s and master’s degrees declined to 55,152 in 2023-24, down 6.6% from the prior year. Bachelor’s degrees fell to 40,817, down 3.3%, while master’s degrees in accounting or taxation dropped about 15% to 14,335.

There are some signs of recovery. AICPA cited two consecutive semesters of 12% year-over-year growth in accounting enrollment in the 2024-25 school year. Still, the profession is fighting on two fronts at once: trying to widen the pipeline while defending the licensing standards that give the credential its value. ARPL says nearly 75% of voters support protecting licensure for professions entrusted with public safety, health and welfare, and AICPA says 92% of business decision-makers surveyed see a license as important for high public-impact jobs such as CPAs. For KPMG, the message is blunt: talent strategy and licensure policy are now the same conversation.