Welcome to the weekly round up of news from the UK’s legal sector.
Work experience – a great way for smaller law firms to trump the big dogs
If you run a boutique law firm, offering work-experience placements allows you to really steal a march on your larger rivals: by going to bat for the next generation of legal talent (as associate solicitor Jen Shipley suggests in her recent LinkedIn post), you will forge strong relationships and grow your network in a meaningful way, something that the major-league firms often strike out on. Here are a few reasons why being small can help you win big when it comes to offering work experience:
Greater flexibility brings in diverse talent
By being a David rather than a Goliath, you can be much more flexible in your processes for offering placements. This means that candidates don’t have to scale the wall of bureaucracy put up by many larger firms. You are also better able to offer work-experience placements at other times of year when larger firms might not, such as over Christmas, Easter, half term etc. Such flexibility means that you can broaden the base of people who come and work for you. This not only improves diversity and access, but also brings talent into your business that other, larger firms may well overlook.
The human touch for lasting relationships
As a boutique firm, you are better placed to provide a much more personal experience that benefits everyone. There is a gulf of difference between the drudge work people often find themselves doing during their unpaid internship at a big firm, and the work-shadowing you are able to offer as a small business. And by giving them access to your world and delivering profound insights into your legal practice, you can forge a warm, meaningful working relationship with your shadow, something that can pay dividends.
Offering such high-quality work-experience placements grows your network in a powerful way, as little will trump a future lawyer’s first positive work-placement experience. These people may come to work for you further down the road, or they might end up at another law firm – but wherever they go, they will carry with them their lovely experience of their first placement with you. So, if they end up at a big City firm and you happen to run an employment-law boutique, for example, guess who your former work-shadow is going to think of first and then enthusiastically recommend when their firm needs expertise in your field?
Computer says no. A note to HR departments at big firms
We want to end with some advice to the HR teams at larger firms, who are often guilty of reducing the pool of work-experience applicants by putting up bureaucratic hurdles. Ostensibly designed to improve the process, the actual effect of these at-times Byzantine application systems is the polar opposite – the analogy that immediately springs to mind is that of speaking to a cashier at the supermarket versus using the annoying and often malfunctioning automatic checkout lanes. It’s a dehumanising experience that forges no bonds and adds no value. Convoluted HR processes defeat the very purpose of offering work experience in the first place – creating human connections and forging working relationships that will last decades. So HR teams take note – you might want to change your processes to stop missing out on top-quality talent.
Law firms are hurtling towards a recession, says Paul Hodkinson
In his recent article for Law.com International, editor-in-chief Paul Hodkinson, writes that law firms are facing soaring costs just as the world is teetering on the edge of a recession. He cites the latest projections from the International Monetary Fund of a sharp drop in global economic growth by the end of 2022, with a further fall predicted in 2023.
The worst-hit economies will be those where law firms are largest, particularly the US, the UK and Eurozone, though developing economies such as China, Brazil, Mexico and South Africa are also likely to feel the pain of rising inflation and the resulting hikes in interest rates.
These winds of change are already blowing through the corridors of commercial law firms. And the timing could not be worse, following a year-long pay war amid the fight for junior talent (see our recent newsletter for more on this story). A half-year analysis of the largest US-based firms by Citi showed that their revenue growth had dropped from 14.6 per cent last year to just 5 per cent in the first half of this year, whereas expenses have increased by 14.7 per cent. This latter figure is largely driven by a whopping 17.5-per-cent increase in compensation expenses.
Law firms are therefore hurtling towards a recession, with top-earning transactional lawyers likely to take the biggest hit: M&A is down 23% year-on-year, equity capital markets are in the doldrums, and global equity market issuance is down 68% – its slowest period since 2005.
You are likely to feel the impact of these tough times ahead, no matter what size your firm, and you should be actively planning how to weather the economic downturn and emerge from it even stronger. Our founder Simon Marshall has written a blog on this very subject. If you want to have a conversation with him about creating your roadmap for navigating the recession, please get in touch.
A good time to remain front of mind – meet the legal press
Do you have some great news about your business and would love the legal press to write about it? Well, the best way to make that happen is to contact the titles directly! Not sure who to contact? We’re here to help.
It’s a good idea to know who the news editors are at the various legal press titles. So we’ve named a few of them here to get you going:
The Lawyer – Rachel Moloney – firstname.lastname@example.org
Law.com International (formerly known as Legal Week) – Rose Walker – email@example.com
Legal Business – Tom Baker – firstname.lastname@example.org
FT – Kate Beoiley – email@example.com
Law Society Gazette – Michael Cross – firstname.lastname@example.org
Bloomberg Law – Jeremy Hodges – email@example.com
Estates Gazette – Sarah Jackman – firstname.lastname@example.org
Legal Business magazine announces shortlist for 25th anniversary awards
The shortlist has been announced for this year’s Legal Business Awards, which feature 25 different categories and whose awards ceremony is often referred to as the Oscars of the legal world.
Congratulations to the nominees, which include Fox & Partners, Milberg London, Latham & Watkins and Reed Smith. We are particularly interested to see how our friends get on in the categories of Boutique Law Firm of the Year and Law Firm of the Year.
From the salary war to rightsizing – that was quick!
It feels like only last week that law firms were talking up a hot employment market and busily fighting over lawyers, using massive pay packets to lure in talent.
But this week, firms are all set to engage in ‘rightsizing’, i.e. scaling down the payroll through attrition and performance reviews in the face of the looming recession.
The downturns in 2008/9 and early 2020 taught law firms that early layoffs or too many can lead to problems further down the road. Now firms are likely to thin the herd by stealthier measures, such as more deliberate performance reviews, repurposing associates and natural attrition.
It’s such a fine balance to get right – cutting too much is as troubling as not pruning enough.
The legal consultant calculator
Our article in last week’s newsletter about the mass exodus of senior lawyers from traditional law firms in favour of consultancy work seems to have resonated with many of you.
This has inspired Si to create what we consider to be a nifty consultancy salary calculator to help you assess whether or not to make the move to consultancy. Click here to access the widget, which we are currently trialling in a beta version (it’s at the bottom of the blog): https://www.tbdmarketing.co.uk/the-appeal-of-the-consultancy-model-for-senior-lawyers/
Pop in a few details and it will tell you the difference between your current role and what you could expect to earn as a consultant lawyer. These new figures will update automatically every time you adjust one of the variables.
Want more holidays? To work fewer hours? To charge less by the hour? It’s all possible.
As we say, this is a beta version and we are definitely open to your feedback regarding potential improvements. But even as it stands, the calculator serves to highlight some obvious appeals of the consultancy model – including potentially working fewer hours to earn the same salary.
We hope that you find it useful.
I hope you’ve enjoyed this edition. Let me know if you have a story you’d like us to consider.