LAW firms are maintaining a bullish stance on the outside, with yesterday’s quarterly Deloitte survey (see right) seeing firms forecast an average increase in fee income of 6.2 per cent for the 2011-12 financial year.
But behind the scenes caution reigns. Equity locksteps are being reviewed, the intermittent trickle of redundancies is threatening to turn into a steady flow, and more and more backroom services are being outsourced to cut costs. Like so many other sectors that rely on corporate transactional work to survive, legal services changed forever when the pipeline dried up somewhere around November 2008. Sources say a new dawn of prudence has permeated the sector, with penny watching a priority as fee rises dry up and competition increases.
Despite this, the law firm model remains a stable one, and one which banks are happy to help grow. So for every partner redundancy that’s mooted, expect to hear an announcement of an office opening in eastern Europe, or a team lateral hire poached from a rival.