New research shows a dark economic picture for law firms during the next 12 months:
- The current year will represent a significant downturn for the legal industry as a whole. Across-the-board rate increases will not be possible in 2009 .
- Profits per partner in 2008 will on average be flat to a minus 10 percent, as compared to profit levels in 2007, causing a severe strain on many firms.
- Law firms are unlikely to see any significant turnaround until late 2009.
- There will be a significant contraction across the industry over the next several months as firms are forced to lay off legal and non-legal staff, slow down the hiring of new attorneys, restructure operations, and weed out unprofitable practices.
- In most law firms, productivity dropped significantly in the second half of 2007 driven by sharp downturns in real estate, structured finance, and transactional practices. That slowdown continued into 2008, and has been deepened by the current crisis in the financial system.
- The current downturn has not yet been significantly offset by increases in other traditionally “counter-cyclical” practices like bankruptcy, litigation, and regulatory work.
These grim facts are reported by Hildebrandt International in their Special Client Advisory: Fall 2008. The key passage in the report states:
Stay in close touch with your clients, especially those key clients that are important to the firm’s future. Now is not the time to save money by cutting back on productive marketing expenses. Your clients are experiencing the same anxieties and uncertainties as the firm itself, and ramping up communication to them will stand the firm in good stead when economic conditions improve. Lawyers have time on their hands, so put it to good use with increased focus on client development, client teams, and appropriate business development training.
For a related story, read "ACC/Serengeti Survey: The Economic Picture for Law Firms Gets Worse" on the LawMarketing Portal at www.lawmarketing.com
Read more detail on Legal News Directory – Legal Marketing